View more on these topics

China scraps trading ‘circuit breakers’

China-Great-Wall-Asia-700x450.jpg

China has scrapped the ‘circuit breakers’ it introduced at the start of the week that intended to reduce market volatility, after two days of market closure.

The circuit breakers were introduced to minimise market losses and meant a 15 minute halt to trading after a 5 per cent fall in the market and a stop to the day’s trading following a 7 per cent fall.

However, markets were forced to close on Monday and Thursday this week after 7 per cent falls were recorded, with the stock exchange staying open just 870 seconds before the first trading halt on Thursday.

In a statement issued by the Shezhen and Shanghai stock exchanges they said the circuit breakers were being suspended to “maintain smooth operation of markets”.

The Financial Times reports that in a statement the China Securities Regulatory Commission said: “The circuit breaker mechanism is not the main reason for the market drop, but based on the experience of the two recent instances, it hasn’t achieved the expected effect, but rather produced a definite ‘magnetic effect’.”

Before the decision was announced Mark Dampier, head of investment research at Hargreaves Lansdown, said: “The system doesn’t work and until it is withdrawn or modified we can expect to see further use and perhaps shorter trading periods than we saw last night.

“The interference by the authorities is simply delaying the inevitable. The market needs to find its own level so we will see more volatility in global markets until it does.”

Recommended

Tracey McDermott FCA 700x450.jpg
9

Tracey McDermott ruled out of FCA top job

Tracey McDermott has ruled herself out of replacing Martin Wheatley as the head of the FCA, Chancellor George Osborne has revealed. McDermott is running the FCA as interim chief executive at the moment while a new chief is sought. But speaking on Radio 4, Osborne said that she did not want the job full time. He said: […]

FCA logo new 3 620x430

The biggest FCA fines of 2015

The FCA imposed a total of £905,219,078 in fines in 2014 against 39 firms. The level of penalties marks a 38 per cent fall on the £1.4bn issued in fines in 2014. Banks continued to pay the price for foreign exchange failings, as well as manipulating Libor rates. Issues around complaint handling related to missold […]

Santander-700x450.jpg
3

Santander UK confirms investment advice return

Santander has confirmed it will return to the UK investment advice market less than two years after being hit with a £12.4m fine by the FCA, the FT reports. Reports first emerged in September last year that the bank was eyeing a return to the market in response to an expected slowdown in current account […]

Healthcare regulation amalgamation predicted for Gulf states

While Dubai is leading the way in terms of legislating for expat healthcare in the Gulf, Qatar, Abu Dhabi and others are watching and learning – that’s according to Jelf International’s director of international services, Doug Rice. He believes the pace of change in the Gulf states will continue and that some level of unified healthcare system will be introduced across the region.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment