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China: Stocks give up gains amid yuan depreciation worries

Wednesday, May 25, 2016 - 15:42
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China stocks gave up early gains to end weaker on Wednesday despite a sharp rebound in Hong Kong, as yuan depreciation fears resurfaced on the back of a stronger dollar and a possible US rate hike next month.

[SHANGHAI] China stocks gave up early gains to end weaker on Wednesday despite a sharp rebound in Hong Kong, as yuan depreciation fears resurfaced on the back of a stronger dollar and a possible US rate hike next month.

The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 0.1 per cent, to 3,059.23, while the Shanghai Composite Index lost 0.2 per cent, to 2,815.09 points.

Trading volume in Shanghai shrank to the lowest level in nearly four months, reflecting low risk appetite.

There are fresh worries about money outflows as the US looks increasingly likely to raise interest rates again soon.

The yuan eased to within a whisker of its early February trough on Wednesday, after the central bank fixed the softest midpoint against the dollar since March 2011.

Most sectors fell, with transportation shares leading the decline.

REUTERS