China shares rose modestly Monday after authorities moved over the weekend to tighten the use of informal lending channels by stock investors.
Markets in Tokyo were shuttered for a holiday
In Hong Kong, the Hang Seng Index hesitated 10.46 to 25,404.81,
Monday’s Asian session also saw gold prices drop nearly 4% in a matter of minutes, before quickly recovering some of those losses. Gold recently traded down 1.7%, or $18.80, at $1,113.10 U.S.
The euro traded at $1.0830 U.S. after hitting a near-two-month low of $1.8026 U.S. on Friday. Euro sentiment soothed somewhat after Germany’s Parliament on Friday backed a rescue for Greece and euro-zone officials completed plans to provide the country with seven billion euros ($7.58 billion U.S.) of bridge financing.
The U.S. dollar rose against several Asian currencies after the Federal Reserve kept alive hopes last week for raising interest rates this year. That has pushed some Asian currencies lower.
South Korea’s won hit a new two-year low against the dollar, continuing a slide that started in late April. The Singaporean dollar fell to a fresh three-month low against the U.S. dollar.
In Hong Kong, brokerage Haitong Securities Co. said its first-half net profit and operating income more than tripled, thanks to a bull market in the January to June period. Shares were down 1.6% Monday.
CHINA
In China, the CSI 300 acquired 9.12 points, or 0.2%, to 4,160.61
Beijing’s efforts to prop up the market appear to have stemmed a slide that left markets with trillions in losses earlier this month. On Saturday, the central bank issued guidelines on its website to regulate fast-growing Internet finance as part of efforts to address risks exposed by the recent stock market turmoil.
Informal lending channels such as peer-to-peer lending, which directly connects borrowers and lenders, have played a major role pumping up the market—but also exacerbating its declines. Analysts expect more regulation could curb the market’s gains in the short term.
The amount of borrowed money used to buy stocks has fallen roughly 37% since a peak in mid-June, according to Wind Information Co.
Still, investors are wary whether government measures—including easing rules on loans to buy shares, suspended trading of some stocks, cutting interest rates and halting initial public offerings—can sustain the momentum.
Some 572 firms in Shanghai and Shenzhen remain halted for trading, roughly 19% of the market by number of firms, according to FactSet. Those shares that have resumed trading have helped unlock liquidity for investors who were hard-pressed to sell for cash.
China’s central bank reported on Friday its gold reserves were half the expected level, up 57% to 53.32 million troy ounces. China is one of the biggest gold buyers globally, and the report showed its central-bank holdings are the fifth-largest in the world. China doesn’t consistently disclose its level of gold reserves.
In other markets
Singapore’s Straits Times Index returned from long weekend 20.03 points, or 0.6%, to 3,373. 48
In Taiwan, the Taiex index settled 70.98 points, or 0.8%, to 8,975
In Korea, the Kospi index lost 3.48 points, or 0.2%, to 2,073.31
The NZX 50 gained 8.17 points, or 0.1%, to 5,861.93
The ASX 200 Index took on 16.78 points, or 0.3%, to 5,686.89
