FRANCHISE HERALD
Friday August 14, 2020

updated - August 14, 2020 Friday EDT

China Market Crash, U.S. Dollar Retreat Send Shockwaves Across the Globe

Aug 25, 2015 09:17 PM EDT | By Don Gil Carreon
Tags
china, stock market, interest rates
Close
AUGUST 10: (CHINA OUT) Investors observe stock market data at a stock exchange hall on August 10, 2015 in Fuyang, Anhui Province of China
(Photo : ChinaFotoPress | Getty Images News)

Markets across the world swooned on Monday after the sharp fall of China's stock market combined with the slide of the U.S. dollar spooked investors across the globe to selling their holdings.

Reuters said China's shares retreated by almost 9 percent after the central bank did not implement an expected cut in reserve ratios to support the stock market after its 11 percent slide last week.The dollar also weakened as the market has become uncertain whether the Federal Reserve will push through in September with its first rate hike in nearly a decade.

Reuters said the twin events sent European stocks crashing by 5 percent, with Wall Street expected to suffer similar losses. Bloomberg reported that emerging markets were likewise battered by shockwaves from China's fall as equities in Vietnam, India, the Philippines and Poland all came tumbling down.

Reuters added that the jitters on China's economy also dragged down the price of oil by 4 percent on concerns that the demand from the resource-hungry country will weaken amid an oversupply. It added that metal prices also took a beating with copper, a proxy for global industrial demand, down 2.5 percent, while nickel slid 6 percent to its lowest since 2009.

Bloomberg said the drop of China's stock market was the worst since 2007. It noted that the fall came even as the government announced over the weekend that pension funds will be allowed to invest in the stock market. The report added that from its peak in June 12, the Shanghai Composite Index has shed 38 percent of its value, which is equivalent to more than $4 trillion.

While investors were reportedly disappointed with the lack of government support for the stock market, Bloomberg pointed out that the government has indeed implemented a raft of measures to prop shares such as unleashing $400 billion for investment in equities, banning selling by major shareholders and telling state-owned companies to buy stocks. 

Get the Most Popular Franchiseherald Stories in a Weekly Newsletter
© 2015 Franchise Herald. All rights reserved.

Connect With Franchise News

Email Newsletter

TOP 10 FRANCHISES OF 2020

  • RANK
    FRANCHISE NAME
    STARUP COSTS
  • 1nc
    Hampton Hotels
    $3.7M - 13.52M
  • 2nc
    Subway
    $85.2K - 260.35K
  • 3up
    Jiffy Lube Int'l. Inc.
    $196.5K - 304K
  • 4down
    7-Eleven Inc.
    $30.8K - 1.64M
  • 5up
    Supercuts
    $103.55K - 196.5K
  • 6up
    Anytime Fitness
    $56.3K - 353.9K
  • 7down
    Servpro
    $133.05K - 181.45K
  • 8down
    Denny's Inc.
    $1.18M - 2.4M
  • 9down
    McDonald's
    $1M - 2.16M
  • 10down
    Pizza Hut Inc.
    $295K - 2.15M
Real Time Analytics