Asian stocks fell, extending the worst start to a year since 1988, as investors were whipsawed in a volatile session punctuated by Chinese authorities’ efforts to stabilize markets.
The MSCI Asia Pacific Index slid 0.3 percent to 128.47 as of 4:12 p.m. in Hong Kong after fluctuating between gains and losses. The largest swings came in Shanghai, with the benchmark index climbing 1 percent, plunging as much as 3.2 percent and then recovering almost all those losses in the final hour. The gyrations came after a 7 percent tumble in the CSI 300 Index on Monday triggered a market-wide trading halt, spurring a global selloff.
The Shanghai Composite Index climbed back from the worst of its intraday declines Tuesday to finish with a 0.3 percent loss. The index has retreated 7.1 percent in the first two trading days of the year. At one point Tuesday, its slide more than wiped out the gauge’s 9.4 percent rally for all of 2015.
Hong Kong sustained bigger losses Tuesday. The Hang Seng Index slid 0.7 percent, while the Hang Seng China Enterprises Index of mainland shares traded in the city fell 1 percent, adding to Monday’s 3.6 percent drop. Thomas DeMark, who correctly predicted the selloff in Chinese equities last year, says shares in Hong Kong are vulnerable to more losses.
Elsewhere in Asia, Japan’s Topix index slipped 0.3 percent, with exporters seeing selling for a second day as the yen held near a two-month high. Toyota Motor Corp. lost 1.5 percent to be the biggest drag on the Topix, while soy sauce maker Kikkoman Corp., which gets 47 percent of revenue from North America, dropped 3.1 percent.
South Korea’s Kospi index increased 0.6 percent. Singapore’s Straits Times Index fell 0.5 percent and Taiwan’s Taiex Index lost 0.5 percent. Australia’s S&P/ASX 200 Index slumped 1.6 percent and New Zealand’s S&P/NZX 50 Index declined 0.7 percent for its first trading day of the year.
Futures on the S&P 500 added 0.1 percent. The underlying index closed 1.5 percent lower on Monday, paring an earlier decline of as much as 2.7 percent.