Chinese equities market slips out of world No.2 spot
China’s equities markets saw extended declines on Friday after two days of big losses.
The Shanghai Composite Index shed 1 percent, or 27.58 points, to finish at 2,740.44, although coal mining and processing companies reported strong gains.
The smaller Shenzhen Component Index declined by 2.03 percent to 8,602.12 points, while the Nasdaq-style ChiNext enterprise board slumped by 1.89 percent to finish at 1,481.61.
Inner Mongolia PingZhuang Energy Co Ltd’s shares surged by the daily maximum of 10 percent to close at 3.83 yuan (US$0.56).
On the night of Thursday, China lost the title of the world’s second-largest stock market to Japan, according to Bloomberg’s data. It overtook Japan to claim the number two spot in November 2014, and the Chinese equities market hit a peak valuation of US$10 trillion in its heyday of June 2015.
The US remains the biggest stock market at US$31 trillion, according to a Financial Times’ report.
The change in the rankings came after Chinese stocks saw volatility this year. The benchmark Shanghai Composite Index has fallen around 16.3 percent so far and was trading some 23 percent below its 52-week high, CNBC reported.
Li Daxiao, chief economist at YingDa Securities Co Ltd, noted that for the time being, many of China's bluechips have been undervalued. As the macro economy remains steady, it is now of great importance for regulators to keep the stock market stable.