On Friday the European stock indices ended down 1.5%. However, the first trading week of 2016 was the worst in decades for most world’s stock exchanges. Major stock indices lost 5-7%, German DAX index declined more than 8%.
In China trading was halted twice in the week because of sharp devaluation of the yuan and following stocks crash. Despite China’s stocks closed higher on Friday, sell-offs on the Chinese stock market continue.
In a move to stop capital outflows, the Chinese government ordered its banks to limit dollar purchases. The decision affected individuals and companies. The government also restricted international money transfers.
Because of the weakening Chinese economy, assets worldwide are depreciating and oil prices keep falling. Brent ended the week at $33 per barrel, falling to a 10-year low.
