(Yicai Global) May 14 -- US stock markets dived in late trading last night on Federal Reserve Chairman Jerome Powell's bearish comments, which prompted wary market sentiment and China’s bourses thus opened lower.
The Shanghai Composite Index set out 0.38 percent down at 2,887.06, while the Shenzhen Component Index dropped 0.43 percent to 11,026.71. The ChiNext Price Index, which that tracks growth enterprises listed in Shenzhen, fell 0.43 percent to 2,131.46.
The COVID-19 crisis raises "long-term concerns," Powell said yesterday, warning that a prolonged recession and weak recovery could lead to an extended period of low productivity growth and stagnant incomes.
The Fed will continue to use its tools to their fullest until the crisis has passed and the economic recovery is well under way, he said. The central bank has ruled out "negative interest rates," however, he advised.
The Dow Jones Industrial Average closed down 2.17 percent, the Nasdaq Composite Index plunged 1.55 percent and the S&P 500 index tumbled 1.75 percent after Powell's statement.
Editor: Ben Armour