China’s Stock Market has Crashed

Photo Courtesy of: www.reliableindex.com

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Photo Courtesy of: www.reliableindex.com

China’s stock market crashed on January 4th, China’s stock market crashed. Chinese media predicted to have high stock market to start this year, but unfortunately the stock market crashed causing their predictions to be incorrect. The Chinese stock market crash has caused many investors scrambling to get their money back before it is too late. mining.com reported, “Chinese bourses tumbled 6.9% in their opening session of 2016, its biggest decline on record for the first trading day of the year, forcing exchanges to halt trade for the first time.”

“The CSI 300, an index of the country’s biggest stocks, fell by 7%, the worst-ever start to a year for Chinese markets. Small-cap stocks fared even worse, many falling by the daily maximum of 10%.” economist.com explained. To cope with the losses, China’s central bank announced that they would give $10.6 billion into the financial system.

The China stock market crash has also caused the Chinese currency to decrease in value. According to variety.com, “This time the crash on Thursday may have been provoked by the rapid weakening of the Chinese currency, which is now close to a five year low against the U.S. dollar.” People believe that these problems may cause political tensions with the U.S. especially, due to China’s policies commonly being criticized by politicians and presidential hopefuls.