Shanghai Composite Index Erases 5.6% Intraday Gains

China’s Shanghai Composite Index posted the biggest intraday surge since March 2009 on volumes 76 percent above the 30-day average, before paring gains as the exchange investigated the spike.

About 9.7 billion shares of Shanghai Composite companies changed hands as of 1:07 p.m. local time, versus 5.6 billion at the same time yesterday, data compiled by Bloomberg show. The gauge jumped from a loss to a gain of 5.6 percent in two minutes before paring its advance to 1.7 percent.

The Shanghai bourse said its operations are normal, according to a statement posted to its official microblog. There was no news to spur such a rally in the market, said Gerry Alfonso at Shenyin & Wanguo Securities Co.

“Such a movement won’t help to boost market confidence,” said Li Jun, a strategist at Central China Securities Co. in Shanghai. “Most investors would view such a sudden spike in a market with very poor sentiment as irrational and illogical.”

The Shanghai bourse is looking into the jump, said a technical services official at the exchange, who declined to be identified because of its rules.


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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu