will suspend its new stock market circuit-breaker mechanism - designed
to stop free-falling prices - from Friday, the Shanghai and Shenzhen
stock exchanges have said.
The mechanism, which had been in place since the start of this year,
suspends trading on China’s main stock markets if stocks fall 7%.
That circuit-breaker was activated twice this week alone. On Thursday,
it was triggered within half an hour of trading. That gave China’s stock
markets their shortest trading day in 25 years.
"After weighing advantages and disadvantages, currently the negative
effect is bigger than the positive one. Therefore, in order to maintain
market stability, CSRC has decided to suspend the circuit-breaker
mechanism," a statement from the China Securities Regulatory Commission
§ They automatically stop trading in stock markets that drop or
appreciate too sharply - a 15-minute break if the CSI 300 Index moves 5%
from the market’s previous close, or a whole-day halt if it moves 7% or
Analysts said Beijing’s introduction of the circuit-breaker mechanism
had proved counter-productive. Investors had panicked they would not be
able to sell shares they did not want, rather than being reassured over