Asian shares sank
to their lowest in over four years on Monday as doubts mounted about
Beijing's ability to manage the world's second-biggest economy.
The
absence of Tokyo for a holiday only made liquidity even harder to come
by, heightening volatility. Currency markets saw some wild swings with
the South African rand ZAR=D3 collapsing to record lows at one point before bouncing.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slid 1.8 percent to its lowest since late 2011.
China's main indexes .CSI300.SSEC slumped more than 3 percent at one point, Australia 1.25 percent and the Philippines .PSI dropped 3.8 percent.
Financial spreadbetters IG predicted opening losses of 0.5 percent for the FTSE 100 .FTSE, 1.5 percent for the DAX .GDAXI and 1.2 percent for France's CAC .FCHI.
E-mini futures for the U.S. S&P 500 ESc1 fared better, turning flat after an early loss of 0.8 percent.
Commodities were again on the ropes as Brent crude oil LCOc1 shed 79 cents to $32.76 a barrel, while U.S. crude CLc1 was 69 cents lighter at $32.47.
China was again the epicenter of unease as the People's Bank confounded analysts by guiding the yuan's midpoint rate sharply stronger, a move that might calm concerns about a competitive devaluation but only added to market confusion as to Beijing's ultimate intent on its currency policy.
The move was an apparent reversal of the midpoint's recent weakening trend which included the biggest one-day drop in the guidance rate in five months on Jan. 7.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slid 1.8 percent to its lowest since late 2011.
China's main indexes .CSI300.SSEC slumped more than 3 percent at one point, Australia 1.25 percent and the Philippines .PSI dropped 3.8 percent.
Financial spreadbetters IG predicted opening losses of 0.5 percent for the FTSE 100 .FTSE, 1.5 percent for the DAX .GDAXI and 1.2 percent for France's CAC .FCHI.
E-mini futures for the U.S. S&P 500 ESc1 fared better, turning flat after an early loss of 0.8 percent.
Commodities were again on the ropes as Brent crude oil LCOc1 shed 79 cents to $32.76 a barrel, while U.S. crude CLc1 was 69 cents lighter at $32.47.
China was again the epicenter of unease as the People's Bank confounded analysts by guiding the yuan's midpoint rate sharply stronger, a move that might calm concerns about a competitive devaluation but only added to market confusion as to Beijing's ultimate intent on its currency policy.
The move was an apparent reversal of the midpoint's recent weakening trend which included the biggest one-day drop in the guidance rate in five months on Jan. 7.
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