Article / 13 June 2016 at 9:54 GMT

China shares slump amid global selloff and poor data

Saxo Capital Markets China
  • Shanghai Composite Index dropped 3.21% to 2833.07
  • Growth Enterprise Market Index slumped by 6.03% to 2054.71
  • All sectors closed in the red except precious metal shares
 China in the red amid global market selloff. Image: iStock

By Jay Luo 

China's stock markets tumbled on Monday amid a global market selloff. The benchmark Shanghai Composite Index dropped 3.21% to 2833.07 and the Growth Enterprise Market Index slumped by 6.03% to 2054.71. All sectors closed in red except precious metal shares.

Shanghai Composite Index, Daily
Shanghai Composite Index, Daily

Source: EastMoney

Market sentiment was undermined during China’s Dragon Boat Festival holiday as overseas stock markets slumped and the offshore Chinese yuan reached a four-month low versus US dollar.

Growth Enterprise Maket Index, Daily
Growth Enterprise Market Index, Daily

Source: EastMoney

At the same time, China official data released on Monday showed China's fixed-asset investment growth eased to 9.6% year-on-year in the January-May period, the lowest level since May of 2000 and well below the market expectation of a 10.5% rise.

The growth rate of private fixed-asset investment dropped sharply to 3.9% in January-May period. The poor data indicates that economic growth is out of steam and one of the reasons is that oversupply depressed corporate profit margins.

Slowing growth rate of fixed assets investment in China

China fixed assets investment

Data released on Monday also showed China’s value-added industrial output rose 6.0% in May from a year earlier, the same as the previous month and in line with market expectation. Retail sales grew by 10.0% in May compared with a year earlier, down from a 10.1% increase in April.
Another factor for China stock market slump is that lock-up shares worth 262 billion yuan will become eligible for trade in June, a 37.74% rise compared with May.

Some investors also attributed to the selloff to European Cup in football as China shares usually perform badly during major sports events.

In general, the market is now at a delicate stage as investors nervously wait for the decision by MSCI on A-shares’ inclusion into MSCI emerging market index, as well as the decision of the Federal Reserve on interest rates.

— Edited by Clare MacCarthy
Jay Luo is an editor and analyst at Saxo Capital Markets in China
13 June
Tepord Tepord
It was designed by the former Chief Designer of Isuzu’s commercial truck division, Steve Jennes, who is now Chief Designer at Nikola Motor.

6X6 100% Electric drive
Zero idle
Many times cleaner than diessel engines
1/2 the fuel cost per mile compared to diessel
3,700 FT. LBS Torque
2,000 Horsepower
1,200 Miles range
320 kWh Battery
1 million miles fuel free
Regenarative braking
Never plug-in – Turbine charges batteries automatically while driving

Nikola Motor only released some renderings and details of the Nikola One concept, but an actual prototype will only be unveiled at an event in December 2016.

Jay Luo why not ?
14 June
Tepord Tepord
A possible silver lining for Lit Motors, the Silicon Valley-based startup is promising much better specs than its Chinese counterpart. Lit is talking about ~150 miles (241 km) of range on a 10 kWh battery pack, while Lingyun listed the range of its concept at 62 miles (100 km) on a 3 kWh battery pack.

Lit also beats Lingyun on the estimated top speed with ~100 mph (160 km/h) versus ~62 mph (100 km/h). The Chinese startup didn’t disclose any pricing information, but Lit expects the first generation to go on sale for about $24,000.


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail