Investing.com - Asian shares took investors on a roller coaster ride on Tuesday as the Shanghai Composite at one point plunged more than 4%, only to rebound into positive territory ahead of the midday break and then ease slightly again.
The Shanghai Composite neared steady at 11:03 am local time at 3.711.31, down 0.38%, as investors digested official announcements on steps being taken to calm liquidity fears.
The China Securities Regulatory Commission said late Monday state margin lender and main agent in recent stock-market intervention, China Securities Finance Corp., wasn't exiting the market and would continue to work to steady it.
The People's Bank of China said in a statement before the market opened Tuesday it would act to stabilize market expectations. It also injected CNY50 billion into the market via seven-day reverse repurchase agreements and kept their rate unchanged at 2.50%.
Still, the steepest decline in Chinese stocks in eight years yesterday weighed on other markets as well.
The S&P/ASX 200 also initially plunged and then eked out a 0.14% gain near the close. The Hang Seng index rose 1.98%, bucking the trend, but the the Nikkei 225 was down 0.94%.
Overnight, U.S. stocks were lower after the close on Monday, as losses in the Oil & Gas, Basic Materials and Technology sectors led shares lower.
At the close in New York, the Dow Jones Industrial Average declined 0.73% to hit a new 3-months low, while the S&P 500 index declined 0.58%, and the NASDAQ Composite index declined 0.96%.
Investors were turning their attention to Wednesday’s Fed statement to see if policymakers will give any indication on the timing of a rate hike.
On Friday, the Fed mistakenly published a staff projection pointing to a quarter point rate hike later this year.
Meanwhile, formal talks between Greece and its international creditors on a new bailout package are underway.
Talks had been expected to start on Friday but were delayed by logistical issues, including security matters.
A new agreement must be reached before August 20 when Greece must repay more than €3 billion to the European Central Bank.