China Shares Fall 2% on Cool Down Measures

Mainland Chinese shares closed down 2% on Monday, leading losses in Asia as investors worried about new measures to cool the red hot stock market.

The Shanghai Composite fell to 5,062.99 on new moves to tighten margin lending and signs of more initial public offering (IPO) issuances.

Analysts estimate around 25 IPOs expected this week could lock up 5.7tn yuan ($918bn; £591bn) of capital.

Hong Kong’s Hang Seng ended down 1.5% to 26,861.81.

The China Securities Regulatory Commission (CSRC) demanded that broker firms make sure they do not allow lending to clients through illicit channels.

Rest of Asia
The rest of Asia headed lower on fears that Greece could default on its debts after it failed to reach a deal in talks with creditors in Brussels over the weekend.

Greece’s bailout expires at the end of the month and the country potentially faces leaving the eurozone.

Japan’s Nikkei 225 closed 0.1% lower at 20,387.79 points while South Korea’s Kospi index shed 0.5% to 2,042.32.

Australia’s benchmark S&P/ASX 200 closed down 0.12% at 5,538.80 points.
Last week, the International Monetary Fund unexpectedly pulled out of talks with Greece after saying that no progress had been made.

“Greek negotiations falling through bring hopes of a resolution too close to the wire, with a lot being hung on the Eurogroup meeting later this week,” wrote Vishnu Varathan of Mizuho bank.

“We expect a tumultuous negotiation process to continue inducing euro volatility.”

via BBC

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