From ZeroHedge, Sun, 02/02/2020 - 21:20:
China Bloodbath: Stocks Crash; Oil, Iron Limit Down Despite Emergency PBOC Intervention, Rate Cuts
As previewed on Friday and again earlier today when we noted the latest trades in China's A50 futures...
... China's reopening from the long Lunar New Year holiday was set to be ugly, and sure enough with Chinese stocks resuming trade at 9am on Monday, a wave of selling was unleashed culminating in nothing short of a bloodbath with the Shanghai Composite crashing 9% at the open, down by the most since the bursting of China's 2015 stock bubble, and wiping out 12 months worth of gains in a corona moment.
Not even the hilarious beat in China's Manufacturing PMI (this time from Caixin), which somehow surpased expectations of a 51.0 print by the smallest amount possible at 51.1 (down from 51.5) despite a major portion of China's population under quarantine and the economy hitting a brick wall, had any impact on stocks.
What is odd is that this is happening even as China earlier in the day barred short selling, which only means the central bank made a huge oversight and should have also banned all selling altogether.
As stocks collapse the flight to safety is predictably on with 10Y Chinese bond tumbling in yield to 3%, matching the lowest yield since late 2016...
... while spiking in price.
The selloff wasn't limited just to stocks, however, with China’s benchmark iron ore contract falling by its daily limit of 8%, with copper, crude and palm oil also plunging by the maximum allowed. As Bloomberg notes, regions accounting for about 90% of copper smelting, 60% of steel production, 65% of oil refining and 40% of coal output have told firms to delay restarting operations until at least Feb. 10........MORE
