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30 Jun 2015
Shanghai composite recovers from three month lows, trades above 4100
FXStreet (Mumbai) - The Chinese stock markets recovered from the three month lows to trade above 4100 levels on reports of IPO suspension and further liquidity operation.
Shanghai Composite erased 5% drop
The index was down 5% below 3,850, but recovered the entire losses to hit an intraday high of 4195.73. The index currently trades at 4135.71; up 2.04%.
The recovery was triggered on reports that PBoC has injected another CNY50B in liquidity through 7-day reverse repo and also lowered the offering yield by 20bps to 2.5%. Chinese press was also reporting that regulators are considering allowing the country's pension fund to invest in A-share market.
Shanghai Exchange also announced a halt in margin trading for select stocks. The rout in the equity markets has been largely blamed on an out-of-control margin trading.
Shanghai Composite Technical Levels
The immediate resistance is seen at 4200, above which the index could target 4264.77 (June 23 low). On the other hand, a break below 4099.04 (May 8 low), under which the index could drop to 4000.
Shanghai Composite erased 5% drop
The index was down 5% below 3,850, but recovered the entire losses to hit an intraday high of 4195.73. The index currently trades at 4135.71; up 2.04%.
The recovery was triggered on reports that PBoC has injected another CNY50B in liquidity through 7-day reverse repo and also lowered the offering yield by 20bps to 2.5%. Chinese press was also reporting that regulators are considering allowing the country's pension fund to invest in A-share market.
Shanghai Exchange also announced a halt in margin trading for select stocks. The rout in the equity markets has been largely blamed on an out-of-control margin trading.
Shanghai Composite Technical Levels
The immediate resistance is seen at 4200, above which the index could target 4264.77 (June 23 low). On the other hand, a break below 4099.04 (May 8 low), under which the index could drop to 4000.