Beijing, China (BBN)-Mainland Chinese shares recovered early losses amid volatile swings, following Monday’s suspension of trading which led to a global equities sell-off.
The Shanghai Composite was up 0.8 per cent at 3,324.27 after opening more than 3 per cent lower, while the Hang Seng also changed direction to head up 0.1 per cent to 21,342.09, reports BBC.
Trading in Shanghai was suspended early on Monday under a new rule designed to limit dramatic falls in markets.
But regulators said on Tuesday they may restrict stock sales to stem falls.
The China Securities Regulatory Commission said it would consider restricting the proportion of shares that major shareholders could sell during a given period of time.
The central bank also injected an unexpected 130bn yuan (£13.55bn; $19.94bn) into the market to keep borrowing costs down – in a move to reassure retail investors.
Analysts said investors were waiting to see if Beijing could stem the latest selling in Chinese stocks and whether more measures would be introduced.
But Bernard Aw, market strategist at trading firm IG said Beijing was arguably more concerned about economic growth than the stock market.
“Furthermore, it could look really bad if they have to throw in more measures when they are in the process of withdrawing the [last] rescue measures,” he said in a note.
The new “circuit breaker” rule that suspended trading nationwide for the first time on Monday was created after sharp falls last summer and was meant to curb market volatility in China.
Monday’s 7 per cent fall in China spooked global markets.
Overnight, US benchmark indexes lost up to 2 per cent as concerns grew that the dive in the Chinese stocks was the start of another volatile period after last summer’s dramatic market rout.
Escalating tensions in the Middle East on oil prices also dented investors’ confidence.
Oil prices were flat after rising as much as 4 per cent on the dispute between Saudi Arabia and Iran.
South Korean shares also headed higher after a senior finance ministry official said the government would take action to stabilise the market if needed, following Monday’s steep plunge.
The Kospi was up 0.8 per cent to 1,933.84 points.
Japan’s Nikkei 225 index also recovered losses to head up 0.4 per cent to 18,527.35, but Australia’s S&P/ASX 200 bucked the uptrend to lose 1 per cent to 5,216.70.