China started the global New Year with some bad economic news on Monday — weaker-than-forecast manufacturing activity and a currency devaluation — prompting a sharp decline in mainland Chinese equities. Trading was halted for the day on the Shanghai and Shenzhen stock markets after the Shanghai Composite Index plummeted 7 percent, triggering a "circuit breaker" mechanism China put in place late last year. The Chinese data, mixed with rising tensions between Iran and Saudi Arabia, pushed European and other Asian stock markets lower on Monday.
"A fall in Chinese markets has brought about a jittery start to the year," Investec economists said in a note. Japan's Nikkei 225 closed down 3.1 percent, Hong Kong's Hang Seng closed down 2.7 percent, and in Europe, Germany's DAX led regional losses, dropping 3.3 percent in early trading. The 10th consecutive month of contraction in China's factory purchasing indicated to investors that China's economy is not responding to government stimulus efforts, which is bad news for other nations' exports.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
-
Why are home insurance prices going up?Today's Big Question Climate-driven weather events are raising insurers' costs
-
'All too often, we get caught up in tunnel vision'Instant Opinion Opinion, comment and editorials of the day
-
2024: the year of legacy media failuresIn the Spotlight From election criticism to continued layoffs, the media has had it rough in 2024
-
Judges block $25B Kroger-Albertsons mergerSpeed Read The proposed merger between the supermarket giants was stalled when judges overseeing two separate cases blocked the deal
-
Rupert Murdoch loses 'Succession' court battleSpeed Read Murdoch wanted to give full control of his empire to son Lachlan, ensuring Fox News' right-wing editorial slant
-
Bitcoin surges above $100k in post-election rallySpeed Read Investors are betting that the incoming Trump administration will embrace crypto
-
Enron mystery: 'sick joke' or serious revival?Speed Read 23 years after its bankruptcy filing, the Texas energy firm has announced its resurrection
-
US charges Indian tycoon with bribery, fraudSpeed Read Indian billionaire Gautam Adani has been indicted by US prosecutors for his role in a $265 million scheme to secure solar energy deals
-
Boeing machinists approve contract, end strikeSpeed Read The company's largest union approved the new contract offer, ending a seven-week strike
-
US economy still strong in final preelection reportSpeed Read It grew at a solid 2.8% annual rate from July through September
-
Boeing machinists reject deal, continue strikeSpeed Read The rejection came the same day Boeing reported a $6.2 billion quarterly loss
