China’s stock market rebounded by nearly 6 <g data-gr-id="35">per cent</g> on Thursday after the government took steps to try to calm down bourses, including roping in the police to probe the precipitous crash that saw Chinese investors losing $3.2 trillion in three weeks of mayhem. After a precipitous fall for weeks, the benchmark Shanghai Composite Index jumped 5.76 per cent on Thursday, the biggest daily rise in six years, to finish at 3,709.33 points. The Shenzhen Component Index surged 4.25 per cent to close at 11,510.34 points. Combined turnover of the two bourses shrank to 950.8 billion yuan ($155.5 billion) from 1.1 trillion yuan the previous trading day.
Chinese police joined the securities regulator to probe clues related to “malicious short selling” amid recent chaos in the stock market, state-run Xinhua news agency reported. Amid growing criticism over the sharp fall diluting an unprecedented over $3.2 trillion worth of capital from the market, Vice Minister of Public Security Meng Qingfeng led a team and visited the head office of China Securities Regulatory Commission (CSRC).
The CSRC announced that China Securities Finance Corporation Limited (CSF), the national margin trading service provider, will provide liquidity to apply for the purchase of a public offering fund.
The CSF is the only institution to provide margin financing loans to securities companies. It has offered 260 billion yuan ( $42 billion ) of stock-secured credit for 21 brokerage firms to conduct self-run share purchasing on the market. The banking regulator, China Banking Regulatory Commission, on Thursday announced it will allow banks to extend mortgage loans that use share funds as collateral.
Banks will now be able to discuss redefining mortgage terms of <g data-gr-id="25">share-secured</g> loans that are due or adjusting collateral with their clients. Before this, the stock market, however, maintained a slumping trajectory. The central bank assured steady stock market ensuring that no systematic and regional financial risks will occur.
`Rs jumps by 21p to 63.39 per $
The Indian rupee staged a smart recovery against the American currency, surging by a healthy 21 paise to end at 63.39 — its highest level in more than two-month on the back of <g data-gr-id="49">hevy</g> dollar selling by exporters. However, <g data-gr-id="50">greenbank’s</g> firming trend in overseas as well as sluggish local equity markets, limited gains, a forex dealer commented.