China’s stock markets suffered their worst single-day losses since 2007 as fears over the state of the Middle Kingdom’s economic health continue to affect investor confidence globally. Dubbed “Black Monday” by no less than China’s official news agency Xinhua, today saw Shanghai’s composite index lose 8.5% to end the day 3209.91 points. That follows on from last week’s 12% drop and a total fall of 30% since the beginning of June that has spooked the global economy. The fear has been infectious: Hong Kong’s Hang Seng Index dropped by 5.17%; Japan’s Nikkei lost 4.6%; London’s FTSE opened trading down 2.6%, hovering above the 6000-point mark; and losses were also felt in in German and French exchanges. On Friday in New York, the Dow Jones industrial average had fallen 3.1% in a downturn that began in May and has plummeted in value by 10%. China’s economic challenges were cited among the key reasons for the sell-off.
China’s bear market is hitting media companies where it hurts. Wanda Cinema Line, the theater operator unit of Dalian Wanda, was down 10%; film company Beijing Enlight Media (in which Jack Ma’s Alibaba Group owns a $382 million stake), was also down 10%; while Alibaba Pictures — listed in Hong Kong — was down 10.2%. Fosun Investment, a major financier of Jeff Robinov’s Studio 8, fared marginally better with losses of 9.2%. Japan’s Sony suffered a bad day at the office, ending the day down 8% to close at $23.50 a share. Japan’s biggest film company Toho lost 5.5%.
Global stock markets have seen more than $5 trillion of value wiped off its books in the last fortnight. That sell-off was sparked by the People’s Bank of China devaluing China’s currency the renminbi on August 11.