August 5, 2011 (Chinavestor) The DJIA fell 512.8 points on Thursday, the most since 2008, as fears of a debt crisis in Europe spread and the labor department will announce all important jobs report on Friday. Latest estimates put the number of total jobs created in July just to 85,000. Fears of what's next sent China stocks tumbling in Asia. The Hang Seng Index (INDEXHANGSENG:.HSI) tumbled 938.6 points or 4.5%, in line with the DJIA (INDEXDJX:.DJI). Stocks fared better on the Mainland where the Shanghai Composite Index (SHA:000001) fell 57.6 points or 2.2%.
Zijin Mining (HKG:2899), the largest gold miner in China, fell 8.0% just below that of Sinopec Shanghai Petrochemical (HKG:0338)(NYSE:SHI), China's largest ethylene maker. ZTE Corp. (HKG:0763), the second largest Chinese mobile equipment maker, fell hard after export outlook darkened. CNOOC Ltd. (HKG:0883), China's offshore oil specialist, fell the most among NYSE cross listed H-shares, followed by Aluminum Corp. of China (HKG:2600). But the decline was not limited to just a few stocks; each and every component of the Hang Seng index (INDEXHANGSENG:.HSI) fell.
Chinese energy stocks fell in both key Asian markets. China Coal (SHA:601898), a key component of the Shanghai Composite Index (SHA:000001) dove 4.3%, the most among the largest component of the index. Price of coal is tied to that of the oil in China, hurting coal and oil producers alike when oil tumbles. Price of oil fell all the way to $83, the largest daily dip in years.
Investor mood of China stock investors soured up so much in the past 24 hours that each and every component of all three major indices fell. Each and every DJIA component fell, followed by the components of the Hang Seng Index (INDEXHANGSENG:.HSI) and the Shanghai Composite Index (SHA:000001). Such universal sell-off hasn't been recorded by Chinavestor in the past three years.
While decline was universal among large caps, some small cap stocks managed to eke out some gains in Asia as component of the Guggenheim China Small Cap ETF (NYSE:HAO) testify. But large caps experienced a broad sell-off in Hong Kong on Friday evidenced by the performance of the Xinhua 25 index. This bodes ill for the iShares FTSE/Xinhua China 25 Index (NYSE:FXI).
Despite a heavy sell-off on Thursday, some Chinese ADRs managed to stay in the black. Noah Education (NYSE:NED) was lifted by earnings while Ata Inc. (NASDAQ:ATAI) rose on technicals.
It's going to be the all important jobs report that will decide the mood of investors on Friday. Fears of a double dip recession are real and markets need some good news to calm nerves down.