China: Stocks tumble more than 6% at open

[SHANGHAI] China's major stock indexes sank more than 6 per cent in early trade on Tuesday, after a catastrophic Monday that saw Chinese exchanges suffer their biggest losses since the global financial crisis, destabilising financial markets around the world.

The CSI300 index was down 6.3 per cent at 3,070.01 points by 0128 GMT, while the Shanghai Composite Index lost 6.4 per cent to 3,004.13 points.

China CSI300 stock index futures for September fell 4.3 per cent, to 3,001, 69.01 points below the current value of the underlying index.

The Hang Seng index in Hong Kong was down 0.6 per cent at 21,119.53 points.

The central bank made a large 150 billion yuan (S$32.95 billion) injection into the interbank market on Tuesday morning during open market operations.

However similarly large injections last week had little impact on stock market sentiment as the funds only remain in the market for seven days.

In fact, many investors worry the injections are being used as a substitute for the longer-term easing to bank reserve requirement ratios which would free up far more substantial sums of cash for long-term investment.

After a year of heady gains, Chinese markets have been buffeted by increasing signs that economic growth is faltering, and the central government's efforts to reassure and backstop stock investors have been sunk by a succession of weakening indicators.

Benchmark indexes not only gave up all the gains made since Beijing's unprecedented stock market rescue in July, in which hundreds of billions of state dollars were ordered into the market, but have entered negative territory for the year.

REUTERS