THE selling which has marked 2016 thus far continued for a fourth consecutive session on Thursday after China's stock market crashed by 7 per cent, triggering circuit breakers that eventually led to trading being suspended only 30 minutes after the market's opening.
Here, the Straits Times Index opened in the red and headed south throughout, finishing with a 74.36 points or 2.7 per cent loss at 2,729.91, bringing its four-day loss to 153 points or 5.3 per cent for 2016. It was the lowest close in about three and a half years. Meanwhile, the Dow futures plunged 250 points during Asian trading, indicating Wall Street would be in for a rough Thursday.
Turnover here amounted to a heavy 1.3 billion units worth S$1.6 billion whilst rounding off a miserable day for stocks was an advance-decline score of 71-397 excluding warrants.
Since China devalued its yuan in August last year and its stock market started buckling under the weight of the excessive leverage undertaken by too many naive retail investors, global equities have come under severe pressure.
Adding to the incentive to sell has been an interest rate hike in the US and growing concerns over China's slowing economy.
Over on Wall Street, the S&P 500 lost 1.3 per cent on Wednesday to 1,990.2 to close at its lowest level since Oct 6 whilst the Dow Jones Industrial Average's 1.5 per cent loss brought its three-day loss to 3 per cent, its worst start to a year since 2008.
On Wednesday, the People's Bank of China fixed the yuan at a lower-than-expected level and on Thursday, the country's stock market opened first with a 5 per cent loss that triggered its newly-installed circuit breakers. When trading resumed fifteen minutes later a fresh plunge ensued that took the Shanghai Composite Index's loss to 7 per cent, leading to trading being halted for the rest of the day.