BEIJING: China stocks slid on Monday as investors feared Beijing would let the yuan depreciate further, despite statements from the central bank last week that it sees no reason for further declines.
The CSI300 index fell 0.5 percent to 4,054.80 points by the end of the morning session, while the Shanghai Composite Index lost 0.1 percent to 3,960.61 points.
The central bank has been trying to steady the yuan in recent sessions and soothe global investors’ jangled nerves after it unexpectedly devalued the currency by nearly 2 percent last Tuesday.
The yuan was little changed on Friday and Monday, but market watchers believe the currency is likely to remain under downward pressure as the economy struggles, keeping pressure on shares of importers and firms with high U.S. dollar debt.
“Investors were not keen to go into market on anticipation the yuan can depreciate further in the long run,” Steven Leung, director at UOB Kay Hian in Hong Kong said.
Insurers also fell on concerns about potential claims after massive explosions in the port of Tianjin, Leung added.
Ping An Insurance Group fell 2.9 percent and China lost more than 3 percent in Shanghai. PICC Property and Casualty slid 1.7 percent in Hong Kong.
Futures markets pointed to expectations of further losses for the benchmark indexes, with China CSI300 stock index futures for August falling 1.0 percent to 3,970.6, 84.20 points below the current value of the underlying index.
