Asian stock markets slide on North Korea’s nuke test

By Chia Lee

North Korea’s testing of a hydrogen bomb apparently shook up Asian markets on Wednesday and Thursday morning.

Most Asian stock markets declined Wednesday after North Korea’s self-proclaimed successful testing of a hydrogen bomb, which unnerved investors.

China’s stocks were suspended from all trade on Thursday morning after the CSI300 index tumbled more than seven percent in early trade, triggering the market’s circuit breaker mechanism for a second time this week.

The index dived 5.4 percent this morning and forced a 15-minute market freeze this morning for the first time.

The CSI 300 Index, a free-float weighted index that consists of 300 A-share listed on the Shanghai and Shenzhen Stock Exchanges, triggers the circuit breaker if it falls five percent. Trading in Chinese stock market would be halted for 15 minutes. If it moves seven percent, trading will be suspended for the rest of the day.

On Thursday, China shares traded around 15 minutes and closed for the rest of the day.

Amid the geopolitical tensions, the rest of the Asian stock markets are extending losses into a fourth straight session as well after trading on China’s stock markets were halted for the day.

The Japanese market plunged following the negative lead overnight from Wall Street. The South Korean shares also fell sharply on news about the nuclear test.

As Asian stock markets dipped, Taiwan shares plunged on Thursday morning as well, which dropped over 200 points.

Executive Secretary of the National Stabilization Fund (NSF), Wu Tang-chieh said Thursday that China’s ban on stock sales by large shareholders in a bid to halt a plunge in stock prices was due to expire Friday, which triggered a panic selling spree and resulted in the major slip.

Wu added that the NSF would step in Taiwan’s stock market when the intervention is considered necessary, calling on investors to stay rational and calm.

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