Why Is China's Stock Market Closed Today? - 9/2/15

chinaWhen investors look for global trading activity on the morning of Sept. 3, their first question is likely to be, "Why is China's stock market closed today?"

Is it to calm the volatility that has plagued China since mid-June? The country's benchmark Shanghai Composite Index lost a massive 37.94% (1,960.36 points) from its June 12 high through the end of August.

And because China is the world's second-largest economy, the sell-off hasn't remained limited within the country's substantial borders.

For example, on Aug. 24 - "Black Monday" - China's stock market crashed 8.49%. That day, Japan's Nikkei tumbled 4.61%, Australia lost nearly 4.09%, and markets across Europe were all in the red by more than 4%. The global rout sent U.S. equity markets into a tailspin. Just after the opening bell, the Dow Jones Industrial Average plunged more than 1,000 points in mere minutes after the opening bell.

The market shutdown Sept. 3-4 could be welcome news in the wake of the China-fueled sell-off.

But the reason China's stock market is closed today is not because dramatic early-day trading triggered a shutdown...

Why Is China's Stock Market Closed Today?

Chinese markets will be closed Thursday and Friday as the nation commemorates the 70th anniversary of the end of World War II, with special emphasis on the Japanese surrender. Tens of millions of Chinese lost their lives in the war when the country was occupied by Japan.

Beijing has officially dubbed the event: "Commemoration of Seventieth Anniversary of Victory of Chinese People's Resistance against Japanese Aggression and World Anti-Fascist War."

It's not just Chinese markets on standstill. Flights have been cancelled and manufacturing halted for a celebratory spectacle...

In addition to declaring Thursday a national holiday, there will be a lavish, massive military parade. More than 12,000 People's Liberation Army troops will march through Tiananmen Square with foreign dignitaries in attendance.

Roughly 2,000 Beijing factories have been partially or fully halted to cut back on sky pollution during the parade. Residents are under strict orders not to watch from windows during the march, use gas stoves for cooking, or loiter on sidewalks. Chinese news websites have reported the government has even gone to the length of releasing trained monkeys and falcons to de-bird the sky for military fly-overs.

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The Shanghai Composite closed down 0.2% in the last session ahead of China's stock market closure.

U.S. markets are closed Monday, Sept. 7 for the Labor Day holiday. That means Tuesday, Sept. 8 will be the next chance for a China-fueled Dow sell-off.

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