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Today there were further falls on the Chinese stock market and Chinese authorities took action to freeze major shareholders' assets in a effort to halt market panic. Their media seems to be blaming outsiders for their problems.
Then in New York the stock market was taken down, whether by computer glitch (IF you choose to believe the official version) or cyber attack. Whatever the explanation it took down United Airlines and Zero Hedge as well. (Lots of coincidences)
To cap it off Amtrak passengers were stranded for 14 hours by a train breakdown.
And let us not forget the breakdown of Greece and the European (dis)Union
RT, it has to be pointed off has not been quick off the mark to produce this rather uncritical article about the stock market woes
China
freezes major shareholders’ stakes in bid to halt market panic
RT,
9
July, 2015
In
an effort to halt market collapse following a drop of some 6 percent
on Wednesday, China’s securities regulator made an extreme move to
ban major investors holding over 5 percent of any listed company from
cutting their stakes for six months.
The
China Securities Regulatory Commission has announced that any
shareholder, including foreign investors, who hold more than a 5
percent stake in any Shanghai or Shenzhen listed companies should not
reduce their holdings over the next six months.
Any
violation of the new rule would be treated “seriously,” the
regulator said. The suspension aims to “maintain stability of the
capital market and protect the legal rights and interests of
investors,” the CSRC explained, as cited byXinhua.
The
move comes after another day of panic sales on Chinese markets on
Wednesday, which seen the benchmark Shanghai Composite Index closing
down 5.9 percent, while the CSI300 index fell 6.8 percent.
With
investors having little hope in market recovery, some 500 additional
Chinese companies halted trade of their stocks on Wednesday, bringing
the total to over 1,200 or roughly 45 percent of the market.
Since
mid-June Chinese market value has shrunk by over 30 percent, and the
government has taken a number of measures to restore investor
confidence and stop the sell-off. On Tuesday the People's Bank of
China injected $8.2 bn into the money market on Tuesday, the 4th
consecutive injection since June 25, and was expected to pour another
$5.6 bn (35 billion yuan) into the market on Thursday, according to
Xinhua.
From Zero Hedge
Utter Desperation: Chinese
Police Vow To Arrest
"Malicious Short Sellers"
In what can only be described as total and utter desperation, China's Public Security Ministry and China Securities Regulatory Commission are discussing a plan to take action against "hostile short sellers"...(via Google Translate)
[ Ministry of Public Security in conjunction with the recent Commission investigation of malicious short stock and stock index clues ] correspondent was informed on the 9th morning , Vice Minister of Public Security Meng Qingfeng led to the Commission , in conjunction with the recent Commission investigation of malicious short stock and stock index clues show regulatory authorities to the operation of heavy combat illegal activities .
Which in English means...
Special workforce to be led by Vice Public Security Minister who vows to soon nail down those who manipulate Chinese stocks, index futures
— George Chen (@george_chen) July 9, 2015
However, it appears thety are going to need to do more...
* * *
Just one question: Will the police also arrest the brokers who allowed their clients to lever up to extremes with no awareness of risk, encouraged by the government, buying the stocks of companies that make plastic umbrellas at x-thousand P/E multiples?
* * *
I didn't sell. I swear I didn't!!!! pic.twitter.com/jEi0hYrUkm
— Fed Porn (@FedPorn) July 9, 2015
"I shorted" pic.twitter.com/Q3FzGh7gVC
— zerohedge (@zerohedge) July 9, 2015
As we detailed earlier, China is a $hitshow again...
With more than half of Chinese stocks halted or suspended, traders are scrambling to hedge the potential vacuum under prices when (or if) they ever open again. With options limited to non-existent in China, ETFs around the world are under pressure (with significant discounts to NAV everywhere). The cost of protecting against significant downside is now at its highest on record and the skew (difference between optimists and pessimists) has never been higher... This 'protection' has seemingly relieved some of the vicious cycle selling as yet another round of financing to backfill liquidity holes in broker balance sheets, but Chinese stock futures are trading 2-3% lower in the pre-open (less than might be expected as much driven by margin hike forced unwinds as much as sentiment).
- *CHINA'S CSI 300 STOCK-INDEX FUTURES FALL 2.9% TO 3,363
- *CHINA'S SHANGHAI COMPOSITE INDEX SET TO OPEN 2.1% LOWER
Pushing CSI-300 Index into the red for 2015...
BREAKING: China's stock market opens over 2% lower, with over 400 stocks immediately down 10% ... and about 1400 stocks still in suspension
— George Chen (@george_chen) July 9, 2015
* * *
But have no fear...
Another day, another round of liquidity poured into the leverage black hole...
- *CHINA SEC. FINANCE AIMS TO OFFER LIQUIDITY TO FUND COS.: CSRC
- *PBOC TO INJECT 35B YUAN WITH 7-DAY REVERSE REPOS: TRADER
And the politburo is getting serious!!
- *CHINA CBRC SUPPORTS BANKS TO COOPERATION WITH CHINA SEC FIN
- *CBRC ENCOURAGES BANKS TO COOPERATE WITH CHINA SEC. FINANCE
- *CBRC ENCOURAGES BANKS TO OFFER FINANCING TO CHINA SEC. FINANCE
- *CHINA CBRC TO SUPPORT STABLE STOCK MARKET DEVELOPMENT
- *CBRC ENCOURAGES BANKS TO ADJUST LOANS TERMS WITH STK COLLATERAL
- *CHINA CBRC ENCOURAGES BANKS TO HELP FINANCE STK REPURCHASES
Next come the orders on pain of death!!??
And then there's this...
- *HAITONG SECURITIES SLUMPS 16.6% IN H.K. AFTER SHR BUYBACK PLAN
That's not what is supposed to happen!!!
But traders have been extremely active in their hedging...
Crash risk has never been more expensive...
While At-the-Money Vol has spiked to 4-year highs...
Overnight saw Flash Crash come to China...
Selling pressure is heavy on the ETFs with all major China ETFs trading well below their NAV (ASHR 4.6% below!!)
And if you thought it was time to BTFD... consider this...
Chinese stocks are still extremely rich relative to the rest of the world.
* * *
We have one simple question.
How do say "unleash the Bullard" in Chinese?
Charts: Bloomberg
China Makes Selling For Big Investors Illegal
With another bloody session in the books for China’s bursting equity bubble, it’s now abundantly clear that Beijing and the PBoC have lost control not only of the market but of the narrative as well, despite dozens of attempts to steer both in the “right direction.”
Having corralled selling by the National Social Security fund earlier this week and after discouraging local reporters from mentioning selling in the press, China has now made it illegal for big investors to dump shares over the next six months. Here are the details via Bloomberg:
China’s securities regulator banned major shareholders, corporate executives and directors from selling any of their stakes for six months, the latest effort to stop a $3.5 trillion rout in the nation’s equity market.
Controlling shareholders and investors holding more than a 5 percent stake in a company will be prevented from cutting their holdings over that time period, the China Securities Regulatory Commission said in a statement.
Recently, the stock market fell irrational, for the maintenance of the capital market, and earnestly safeguard the legitimate rights and interests of investors, is now on the relevant matters are announced as follows: First, from now on within six months, the controlling shareholders of listed companies and shareholders holding more than 5% (hereinafter, saying large shareholders) and its directors, supervisors and senior management personnel shall not reduce shares held by the secondary market. Second, the major shareholders of listed companies and the directors, supervisors and senior management personnel who fails to reduce shareholdings in the Company, the China Securities Regulatory Commission will be given serious treatment. Third, the major shareholders of listed companies and the directors, supervisors and senior management personnel in the six months after the reduction of shares from shareholders with specific measures, separately.
Yes, the stock market "fell irrational" lately. And by "irrational" the CSCR apparently means that temperament that tends to fall over people once they realize they've helped to faciliate a completely "irrational", debt-fueled mania that's sent valuations on many listings into the stratosphere and lured in millions of farmers and hairdressers who are now collectively leveraged to gills.
In any event, this, like every other move in China's rapidly expanding plunge protection playbook, will fail miserably, meaning Beijing with ultimately be left with no choice but to "halt" whatever shares are still trading by the end of the week.
We can now add one more desperation measure to the annotated history of Chinese market intervention:
Sinister forces are at work in China’s stock market, according to at least one “non-biased” Hong Kong newspaper.
RT were, however, super quick in reporting this
Computer
glitch shuts down trading on New York Stock Exchange
RT,
8
July, 2015
Trading
on the New York Stock Exchange floor was halted for nearly four
hours. The stoppage shortly after 11:30 a.m. local time Wednesday,
with all screens displaying a “No quotation” message, according
to eyewitnesses. Trading resumed around 3:10 p.m.
"We're
currently experiencing a technical issue that we're working to
resolve as quickly as possible. We will be providing further updates
as soon as we can, and are doing our utmost to produce a swift
resolution, communicate thoroughly and transparently, and ensure a
timely and orderly market re-open," the
NYSE said in an official statement.
Technical issue at the @NYSE, trading suspended! (@SquawkStreet@CNBC)pic.twitter.com/Eupig2wg8x
— ... (@BRubinCNBC) July 8, 2015
"It's
chaos. No one seems to know the root of the cause which seems to me
is making everything worse," a
source on the floor of the stock exchange said, according to
Bloomberg reporter Leslie Picker.
"Trading has been frozen. .. We're not getting any data, and no trading is going on" -@BobPisani, on the @nyse floor @CNBC
— Carl Quintanilla (@carlquintanilla) July 8, 2015
The
NYSE is reportedly rushing to fix the "technical
problem," but
there has been no official explanation why all floor trading has been
halted. The exchange said it was canceling all open orders as well.
"We've
had some technical malfunctions. Some may be related to connectivity
with other exchanges. I believe we're going to have a temporary pause
certainly in a variety of stocks perhaps floor wide," Art
Cashin, director of floor operations at the NYSE, told CNBC.
TRADING STILL HALTED, our Nicole Petallides just reported @NYSE rushing to fix 'technical' problem. No detail on why there's NO floor action
— Liz Claman (@LizClaman) July 8, 2015
The
NYSE suspended all trading at 11:32 a.m., half an hour after initial
reports of a technical problem, according to Yahoo Finance.
Almost
an hour into the shutdown, NYSE tweeted that the problem an "internal
technical issue" and
not a cyber breach.
(1
of 3) The issue we are experiencing is an internal technical issue
and is not the result of a cyber breach.
— NYSE (@NYSE) July 8, 2015
"We
chose to suspend trading on NYSE to avoid problems arising from our
technical issue," the
exchange said in a series of tweets. "NYSE-listed
securities continue to trade unaffected on other market centers."
We're at ONE HOUR of no trades on the #NYSE floor pic.twitter.com/C5cHYsrxn4
— Erin Dresch (@erindresch) July 8, 2015
There
was another technical glitch at NYSE earlier this morning, but it was
supposedly fixed before the floor opened for trading at 9:30 a.m.,
Marketwatch reported. This morning's problem was a "gateway
connectivity issue," according
to Joe Saluzzi, co-founder of Themis Trading.
After
the suspension, traders were told that the problem was related to
updated software that was rolled out before markets opened on
Wednesday, one trader told the New York Times, on condition of
anonymity.
NYSE New York Stock Exchange - Technical Issues - Trading suspendedhttps://t.co/NrW7PD0HL1 pic.twitter.com/glDRNWSgU8
— Robert Redl (@redlrobert) July 8, 2015
The
stock exchange cannot reopen until all open trades were nullified...
manually.
"At
the NYSE this is a manual process," Sal
Arnuk, a principal at Themis Trading, told Yahoo Finance."Is
the NYSE technologically the most [robust] exchange in the world? No.
The fact of the matter is the different exchange operators have
diverse standards, different architecture. Some of them are more
legacy than others. This is to be expected from time to time."
NYSE
stocks are still being traded through other venues, Reuters reported.
NASDAQ
announced its systems were operating normally and trading NYSE
securities.
Nasdaq
systems are operating normally and are trading all symbols including
Tape A (NYSE) securities.
— Nasdaq (@NASDAQ) July 8, 2015
Other
exchanges, such as NYSE Arca and NYSE Amex/Arca Options,
are "unaffected
by this issue and continue normal operations at this time," the
stock exchange said.
However,
NASDAQ and the BATS Global Markets stock exchanges have
declared "self
help" against
the NYSE, Buzzfeed's Stacy-Marie Ishmael reported. This means that
they are opting out of the national market system due to the NYSE's
technical problems. The two exchanges will stop routing trades to and
from the NYSE if they have reason to believe the quotes or prices
are "stale." Self
help is designed to protect investors from having trades executed at
bad prices, according to the Wall Street Journal.
Losses
have been felt across all of the stock markets stemming from the NYSE
trading halt, Marketwatch reported.
Losses in U.S. stock markets build as NYSE endures trading halt.pic.twitter.com/yxS8ldo4Um
— MarketWatch (@MarketWatch) July 8, 2015
The
Wall Street Journal website (wsj.com)
was down as well. In the meantime, the newspaper set up a temporary
website at http://onlinedr.wsj.com/dr/.
Ummm.... http://t.co/YuuuBtJwvv is also down.
— Dan Primack (@danprimack) July 8, 2015
Earlier
today, United Airlines grounded
its entire fleet for
over three hours due to a computer problem.
OK, this is a crazy day. First UA grounds its planes. Now the NYSE halts trading due to technical issues. http://t.co/yjU5v3KkoC
— Carl Howe (@cdhowe) July 8, 2015
First @united grounds their planes, then @NYSE halts trading...is this real life or a viral marketing campaign for #MrRobot
— Albert Antiquera (@albertantiquera) July 8, 2015
Department
of Homeland Security (DHS) officials said there was "no
indication" of
a cyber attack behind the problems at the NYSE, United Airlines or
the Wall Street Journal's website.
DHS says no indication of a cyberattack at #NYSE
— Alexey Yaroshevsky (@Yaro_RT) July 8, 2015
The
FBI reached out to the NYSE, but was told that "no
further law enforcement action is needed at this time," with
the NYSEdescribing the situation as a "technical
glitch," the
FBI said in a statement to CNBC. The bureau will continue monitoring
the situation.
Securities
and Exchange Commission (SEC) Chief Mary Jo White said the agency
was "closely
monitoring the situation and trading in NYSE-listed stocks."
The
WSJ site was back online just after 12:00 p.m. ET.
The
NYSE will close at it's normal 4:00 p.m.
Zero Hedge has, not surprisingly been looking at the whole thing all day
Is
This What The First World Cyber War Looks Like: Global Real Time
Cyber Attack Map
After
a series of cyber failures involving first UAL, then this website,
then the NYSE which is still halted, then the WSJ, some have
suggested that this could be a concerted cyber attack (perhaps by
retaliatory China unhappy its stocks are plunging) focusing on the
US. So we decided to look at a real-time cyber attack map courtesy
of Norsecorp
which provides real time visibility into
global cyber attacks.
What
clearly stands out is that for some reason Chinese DDOS
attacks/hackers seem to be focusing on St. Louis this morning.
Whether
this is related to the series of suspicious cyber failures today, is
so far unclear, although if there is a connection at least there is a
way to keep track of the first global cyberwar in real-time.
What
began as a glitch in pre-market trading turned into the NYSE's
longest trading halt since Hurrican Sandy battered the East Coast.
The ever-increasing complexity of US equity markets combined with an
ever-decreasing pool of greater fools leaves windows open on down
days (for it appears these 'glitches' only ever occur on down days)
for markets to break. While NYSE traders defended the very market
structure they have abhorred in the past as evidence that today was
"not a failure," we can't help but find CNBC's Scott
Wapner's amusing remark that "if retail investors want low cost
liquid trading they are going to have learn to live with it" the
perfect post-mortem for a rigged system brimming with confident
insiders ever excited to take mom-and-pop's money.
Japanese Investors Lose Faith In Draghi - Dump The Most Foreign Bonds In History
Before
the Asian Infrastructure Investment Bank and, to a lesser extent, the
Silk Road Fund became international symbols for the end of Western
economic hegemony, there was the BRICS Bank.
Or
at least there was the idea of the BRICS bank.
The
supranational lender imagined by Russia, China, Brazil, India, and
South Africa is, like the AIIB, largely a response to the failure of
US-dominated multilateral institutions to meet the needs of modernity
and offer representation that’s commensurate with the economic
clout of their members
Central
Asian republic of Tajikistan
Amtrak
Keeps Passengers On Stranded Train 14+ Hours
8
July, 2015
RICHMOND,
VA (WTVR) – Less than two miles from the Amtrak station in
Richmond, Virginia, the Washington, DC to Miami train broke down. A
problem with an axle on the dining car brought the train to a stop.
Amtrak
crews tried to remove the dining car, but that didn’t work.
Passengers
told reporters conductors on the train finally told them what was
going on after five or six hours of being stranded.
The
train was supposed to arrive in Richmond at 5:00pm Sunday. Furious
passengers did not get off the train until 6:45am Monday.
Amtrak
says until there is an emergency on the train, passengers cannot get
off the train when it is stranded between stations.
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