Overnight the Shanghai Composite dropped by -6.41% and the Shenzhen Composite was down by -7.34%. Despite everything, the past few weeks after the Lunar New Year saw the implementation of news measures to try and boost the Chinese economy. The securities regulators were also fired over the weekend, which notoriously boosts the markets prior to these type of events. Things started to look positive in China, and the people started thinking optimistically while the markets started to see fair gains. However, as the selling pressure eased off, investors were given more reason to sell and the markets plummeted to prices lower than the Lunar New Year re-opening.
Yesterday, China announced that they are opening their debt market in order for foreign investors to participate; looking as though China is trying to resolve its current debt crisis with more debt. This was the catalyst which increased the selling pressure within the Chinese markets.
Over in the US markets we saw positive durable goods news coming in at 4.90% against the estimated 2.50%, however, the USD did not react to this news greatly, as jobless claims rose to 272 from a prior 260 and the housing price index dropped from .50% to .40%. This again shows that the USD is driven by news factors which may effect the outcome of the monetary policy currently implemented.