China’s benchmark stock index fell to a three-month low on concern a raft of measures to stabilize equities is failing to stop the bear-market rout as traders unwind margin bets at a record pace.
The Shanghai Composite Index slid 3.6 percent to 3,592.35 at 1:04 p.m., after plunging as much as 8.2 percent, the most since 2007. Power, health-care and consumer companies led declines, as only 46 stocks among the 1,106 that trade in Shanghai rose. PetroChina Co. and Industrial & Commercial Bank of China Ltd., the two biggest stocks, lost more than 2 percent.
The central banks signed a memorandum of understanding in Berlin today, when Chinese President Xi Jinping met German Chancellor Angela Merkel, the Frankfurt-based Bundesbank said in an e-mailed statement.
Germany’s financial capital prevailed over Paris and Luxembourg in a euro-area race to win trade in renminbi, which overtook the euro to become the second-most used currency in global trade finance in October, according to the Society for Worldwide Interbank Financial Telecommunication. The U.K. Treasury said on March 26 that the Bank of England would sign an initial agreement with the PBOC on March 31 to clear and settle yuan transactions in London.
“Frankfurt is one of Europe’s foremost financial centers and home to two central banks, making it a particularly suitable location,” said Joachim Nagel, a member of the Bundesbank’s executive board. “Renminbi clearing will strengthen the close economic and financial ties between Germany and the People’s Republic of China.” Continue reading