China’s stock market plunged Monday under selling pressure accumulated during a prolonged holiday. Investors have been worried by the coronavirus outbreak that’s already taken the lives of more than 360 people. Beijing authorities have responded by pumping well over a trillion yuan into the country’s economy and financial system.
Also read: China’s Inflation Hits a Record 4.5% as Beijing Prepares to Test Digital Yuan
Chinese Stock Market Opens With Sell-Off
Reacting to economic complications stemming from the growing coronavirus outbreak, investors marked the opening of the Chinese stock market with an intensive selling. On Monday, the first day of trading after an extended Lunar New Year break, the majority of shares dropped by the daily limit. The CSI 300 Index fell over 9% during the day before closing at 7.9%, the biggest loss since 2015, Bloomberg reported. Ending the year down 2.8% on Jan. 23, the Shanghai Composite Index has now sank 7.7%.
Crypto markets reacted to the losses with a temporary spike. The price of bitcoin core (BTC) briefly exceeded $9,600, its highest level since October 2019, before losing some of those gains shortly after. Bitcoin cash (BCH) jumped to over $393 following the opening of the Asian markets on Monday morning. At the time of writing, BTC is trading in the $9,200-$9,400 range and the price of BCH hovers around the $380 mark.
The stock market slump came after media reports this weekend revealed that Chinese regulators are taking steps to limit short-selling. According to sources quoted by Reuters, China Securities Regulatory Commission (CSRC) issued a verbal directive to that effect, instructing brokerages to prevent clients from selling borrowed stocks when markets reopen on Feb. 3. The CSRC reportedly suspended
