China Stocks Gain as State Funds Buy, Circuit Breaker Scrapped

Chinese stocks gained in volatile trading after the government suspended a controversial circuit breaker system, the central bank set a higher yuan fix and state-controlled funds were said to buy equities.

The Shanghai Composite Index closed 2 percent higher, after falling as much as 2.2 percent earlier. Regulators removed the circuit breakers after plunges this week closed trading early on Monday and Thursday. The central bank set the currency’s reference rate little changed Friday after an eight-day stretch of weaker fixings that roiled global markets. State-controlled funds purchased Chinese stocks on Friday, focusing on financial shares and others with large weightings in benchmark indexes, according to people familiar with the matter.

Source: Bloomberg

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Chinese Stocks Set to Rally After Circuit Breakers Scrapped

Chinese stocks were set to open higher after the government abandoned new circuit breakers blamed for exacerbating the worst-ever start to the nation’s equities.

The Shanghai Composite Index was set to open 2.2 percent higher at 9:25 a.m. local time. Regulators announced the mechanism would be suspended late on Thursday night after plunges this week repeatedly triggered the circuit breakers, which were implemented on Monday. A falling yuan has also raised concern the economic slowdown is deepening. The central bank set the currency’s reference rate little changed Friday.

Source: Bloomberg

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