Shanghai index down 4 percent, leads Asian markets lower

Staff Writer
Columbus CEO

SEOUL, South Korea (AP) — China's main Shanghai stock index slumped more than 4 percent on Wednesday, leading Asian stock markets lower a day after a sharp fall rattled investors around the world.

KEEPING SCORE: The Shanghai Composite Index tumbled 4.4 percent to 3,581.26 after plunging as much as 5 percent. Other Asian markets widened losses. Japan's Nikkei 225 slipped 0.5 percent to 20,458.50 and South Korea's Kospi fell 1.6 percent to 1,925.17. Hong Kong's Hang Seng index was down 1.4 percent to 23,145.17. But Australia's S&P/ASX 200 rose 1 percent to 5,357.80. Stocks in Taiwan and the Philippines were also lower but markets in Singapore and New Zealand were stable.

CHINA FEAR: China's main Shanghai stock index staged a sharp fall for a second day in a row. The plunge comes after a short period of stability following a series of surprise devaluations of the Chinese yuan last week, which sparked jitters in the global markets. Analysts said investors are selling Chinese stocks fearing that the Chinese yuan may be devalued further. The devaluation of the Chinese yuan is expected to aid exports for the world's second-largest economy, but it also underlined concerns about China's economic outlook.

ANALYST'S TAKE: "Market fear is growing. Uncertainty is creeping into markets, as well as the economies on both sides of the Pacific, with China driving the fear," said Evan Lucas, a market strategist at IG. "The market's assessment of Chinese growth is dwindling."

WALL STREET: The U.S. stock market shuffled to a slight loss in a lazy day of summer trading Tuesday. The Standard & Poor's 500 index slipped 5.52 points, or 0.3 percent, to close at 2,096.92. The benchmark for most mutual funds has lost just 7 points this month. The Dow Jones industrial average lost 33.84 points, or 0.2 percent, to end at 17,511.34, and the Nasdaq composite sank 33.35 points, or 0.6 percent, to 5,059.35.

OIL: Benchmark U.S. crude fell 17 cent at $42.45 per barrel in electronic trading on the New York Mercantile Exchange. The contract closed up 75 cents at $42.62 Monday. Brent crude, a benchmark for international oils used by many U.S. refineries, dipped 20 cents at $48.61 per barrel.

CURRENCIES: The U.S. dollar weakened to 124.300 yen from 124.391 yen while the euro strengthened to $1.104 from $1.103.