Mainland China share market declined for second straight day on Tuesday, 16 June 2015, after Beijing's latest ruling on margin financing and ahead of fresh wave of IPOs this week. The benchmark Shanghai Composite Index tanked another 175.56 points, or 3.5%, to 4887.43, after washing out 2% yesterday.
Chinese regulators' tightened margin regulations for over-the-counter shares. China Securities Regulatory Commission said investors need to have a minimum daily balance of 500000 yuan ($80000) securities assets in the last 20 trading days to take margin loans. The securities regulator also said the size of margin finance balance at each broker may not exceed four times of their net capital.
The tightening adds stress to a market already facing liquidity pressure from a prospective wave of 25 initial public offerings this week, which estimated to lock up 5.7 trillion yuan ($918 billion) of liquidity.
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