BEIJING – China’s benchmark stock index tumbled by 7.7 points on Tuesday – the steepest decline in a year – underscoring growing unease among investors about long-term prospects for economic stability.
The Shanghai Composite Index fell by 257 points in the first day of trading since the Chinese central bank announced over the weekend that it would tighten credit outflows by raising reserve ratios on consumer banks by 1 percent this month to a record-high level. With the markets closed for the Chinese dragon boat festival on Monday, Tuesday was also the first day of trading since the price of oil hit $140 a barrel, another likely factor in the sell-off, economists said.
Over the weekend, the People’s Bank of China said it will increase this month to 17.5 percent the amount of cash banks must hold in reserve, on the heels of growing concern over rising inflation and worries about the cost of damage and rebuilding after the May 12 earthquake in Sichuan province. The bank has raised reserve ratios multiple times in the past year, hoping in part to help curb record-paced inflation. Consumer prices rose by a near-record 8.5 percent in April and figures for June are due out on Thursday.
Analysts said Tuesday’s drop was likely temporary and the markets would recover.
“I think the market is over-reacting,” said Zhai Biao, and analyst with Guotai Jun’an Securities. “There are emotions involved.”
China’s volatile stock exchanges, widely considered heavily overvalued, have fallen by 44 percent since the start of this year. On Tuesday, Internet chat sites were ablaze with angry comments after the stock market plunge, with many commenters critical of a perceived failure of government policies to protect investors.
Cautioned one: “Remember, very few people make money in the stock market – it’s like getting a ticket for the opening ceremony of the Olympics.”
For complete coverage, see Wednesday’s issue of WWD.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast