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| Chinese stock markets rebound for a second day | Chinese stock markets rebound for a second day |
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| China’s stock markets surged for a second day after determined action by the Chinese authorities to prevent a continued meltdown. | China’s stock markets surged for a second day after determined action by the Chinese authorities to prevent a continued meltdown. |
| Shanghai’s composite index closed up 4.5% on Friday after rising by as much as 6.7% during trading – its best two-day gain for seven years. The Shenzhen component index was up 4.6%. | Shanghai’s composite index closed up 4.5% on Friday after rising by as much as 6.7% during trading – its best two-day gain for seven years. The Shenzhen component index was up 4.6%. |
| More than 1,300 stocks were up by the daily limit of 10%. However trading remained suspended in more than half of companies listed on the stock market in an attempt to prevent more losses. | More than 1,300 stocks were up by the daily limit of 10%. However trading remained suspended in more than half of companies listed on the stock market in an attempt to prevent more losses. |
| Following Thursday’s ban on share sales by major investors, premier Li Keqiang said on Friday China had the confidence and capability to promote healthy development of its capital market to provide a sound financial environment for economic growth. | |
| “China is and will face various challenges and risks during economic expansion. We will never take them lightly,” Li told a conference on the country’s economy. | “China is and will face various challenges and risks during economic expansion. We will never take them lightly,” Li told a conference on the country’s economy. |
| Related: Why is China's stock market in crisis? | Related: Why is China's stock market in crisis? |
| Li did not comment on the stock market’s recent nosedive which caused panic among investors. | Li did not comment on the stock market’s recent nosedive which caused panic among investors. |
| It has been one of the most volatile weeks ever for Chinese stocks, with at one point losses reaching 30% since the markets started falling from a peak in mid June. Friday’s rebound narrowed the losses on the Shanghai index to 25%. | |
| The Chinese authorities have taken a raft of measures over the past week in an attempt to prevent further losses, although analysts are divided on whether the overall effect has been to steady nerves. | The Chinese authorities have taken a raft of measures over the past week in an attempt to prevent further losses, although analysts are divided on whether the overall effect has been to steady nerves. |
| The central bank provided 120bn yuan (£12.4bn) to the state-approved China Securities Finance Corporation, which backs brokers making loans to share buyers. Among the most drastic measures included banning shareholders with large stakes in listed firms from selling shares for six months. On Friday, four state-owned asset management companies pledged not to sell stocks while the market remained volatile. | |
| The ministry of public security and China’s financial regulators are reportedly investigating more than 10 investors for alleged “malicious” short selling of blue chip stocks, although no further details were given. | |
| While some analysts said the government’s measures had helped, others doubted the rebound would end the wild swings the markets have undergone in recent weeks. | While some analysts said the government’s measures had helped, others doubted the rebound would end the wild swings the markets have undergone in recent weeks. |
| Related: Reality is kicking down the door of China's command economy | Greg Jericho | Related: Reality is kicking down the door of China's command economy | Greg Jericho |
| “The current correction is a result of a previous frenzy ... the intervention will give some investors a false impression that the government will always back them up,” Liu Shengjun, deputy director of the Shanghai-based Lujiazui International Finance Research Centre told state news agency Xinhua. | |
| Bloomberg reported that Fidelity Investments, which oversees the largest China funds outside the mainland, along with Goldman Sachs are recommending Chinese stocks as a buy after the recent selloff. They added that the market crash has had limited impact on economic growth. | Bloomberg reported that Fidelity Investments, which oversees the largest China funds outside the mainland, along with Goldman Sachs are recommending Chinese stocks as a buy after the recent selloff. They added that the market crash has had limited impact on economic growth. |
| Meanwhile there have been concerns that the crisis on the stock markets might be starting to infect the property market. State media reported investors selling homes after losing money on the stock markets. | Meanwhile there have been concerns that the crisis on the stock markets might be starting to infect the property market. State media reported investors selling homes after losing money on the stock markets. |
| According to a report in the state-controlled China Daily newspaper, several estate agents in Shanghai reported an influx of properties being offered for quick sale at sharp discounts to the market value as investors tried to make up for their losses. | According to a report in the state-controlled China Daily newspaper, several estate agents in Shanghai reported an influx of properties being offered for quick sale at sharp discounts to the market value as investors tried to make up for their losses. |
| “Some investors sold their stocks to buy properties in March and April. But now we see people selling properties after piling up losses in the stock market,” Cui Aijun, a real estate agent with Shanghai Junda Property Services, told the newspaper. Properties were being listed at 10% below the market average, the China Daily added. | “Some investors sold their stocks to buy properties in March and April. But now we see people selling properties after piling up losses in the stock market,” Cui Aijun, a real estate agent with Shanghai Junda Property Services, told the newspaper. Properties were being listed at 10% below the market average, the China Daily added. |