CHINESE stock markets tumbled 7 percent in their opening session of 2016 yesterday as weak factory activity surveys and falls in the yuan added to concerns about the struggling economy, forcing exchanges to suspend trade for the first time.

    Early losses quickly snowballed in the afternoon, with trading suspended at around 1:30 p.m., about 90 minutes before the regular close.

    Selling intensified after a brief 15-minute trading halt early in the afternoon when main indexes had shed 5 percent, and activities in Shanghai and Shenzhen were halted for the day soon after.

    It was the first day that the so-called “circuit breakers,” intended to curb volatility, had been in effect in China.

    Under the system, intended to reduce wild swings on the Chinese markets, a 5-percent drop in the CSI300 index sees trading suspended in both Shanghai and Shenzhen for 15 minutes before resuming.

    If the index falls 7 percent, the markets are closed for the rest of the day.

    The blue-chip CSI300 index ended down 7 percent at 3,470.41 points, while the Shanghai Composite Index dropped 6.9 percent to 3,296.66.

    A private survey early in the day showed China’s factory activity contracted for the 10th straight month in December, and at a sharper pace than in November.

    An official survey Friday, which focused on larger, State-owned firms, showed a fifth month of contraction, though a pickup in the service sector could cushion the impact on the broader economy.

    Investors also dumped stocks ahead of the imminent expiration of a share sales ban on listed companies’ major shareholders, which had been imposed during the market crash last summer.

    China banned shareholders with holdings of more than 5 percent in a company from selling shares in July as part of efforts to stem a rout that wiped trillions off market capitalizations. The ban will expire Friday, triggering fears of a big sell-off by major shareholders.(SD-Agencies)