China stocks go on wild roller-coaster ride before regulator shoots down rumour on short-selling
- In addition to false rumour, small caps suddenly adjusted earnings estimates from gains to losses
- Meanwhile, news the US is pushing ahead on Huawei charges weighed on smartphone suppliers and sentiment about upcoming trade talks
China’s stock markets went on a wild roller-coaster ride Tuesday, fuelled in part by a rumour – later shot down by the securities regulator – that the key task for the regulator in 2019 is to promote the mechanism for short-selling.
The Shanghai Composite was down by as much as 1.4 per cent at one point, but closed down just 0.1 per cent.
Morning trading started off rocky in the mainland over news that the US charged Huawei
Technologies with bank fraud and conspiracyto steal trade secrets. That weighed on sentiment about the prospects for a positive outcome from the US-China trade talks starting later this week.
Meanwhile, small cap growth stocks took a hit when a number of them unexpectedly revised earnings expectations from gains to losses.
Then some local media said Yi Huiman, the newly appointed head of the China Securities Regulatory Commission, said at a press conference that he will set the regulator’s main task in 2019 as further advancing of a short-selling mechanism in the country.