For the second time this week, China initiated its
emergency circuit breaker system, halting stocks for the day after only about 15 minutes' worth of trading in response to a steep drop in the benchmark CSI300 index. The sell-off occurred after the People's Bank of China (PBOC) set the yuan's reference rate at its lowest point against the dollar since March 2011, according to Reuters. Following the trading halt, regulators announced a curb on the amount of shares prominent shareholders can sell within a three-month window. The disastrous day left China's Shanghai Composite 7.3% lower, while Hong Kong's Hang Seng dropped 3.1%. Elsewhere, Japan's Nikkei ended 2.3% lower, and South Korea's Kospi closed with a 1.1% loss.
European stocks are trading off in step with Asia, and oil prices are also in focus. Specifically, Brent crude futures dropped to levels not seen since early 2004. Energy stocks are among the top losers as a result, while automakers are also absorbing heavy losses due to the uncertainty out of China. France's CAC 40 and London's FTSE 100 were last seen 2.7% and 2.6% lower, respectively, with Germany's DAX giving back 3.3%.
