China Shares Down Due to Weak Metals Prices, Steel Plant Concerns

Shanghai Composite Index six-straight sessions of gains halted as China shares went down Wednesday amid concerns on metals prices and the consolidation of steel plants.

The Shanghai Composite Index loss about 1.4%, that ended their six-session winning streak, dragged by losses in basic materials and energy shares. The smaller Shenzhen Composite Index ended 2.1% down. Meanwhile, Hong Kong's Hang Seng was dragged to a 0.1% loss.   

South Korea’s Kospi rose 0.35%, and Australia’s S&P/ASX 200 gained 1%. In Japan, the Nikkei sold off for the second straight day, giving back 0.8% as a stronger yen weighed on major exporters again.

In China, shares of steel producers plunged after the official news agency Xinhua reported that the governor of Hebei, a northern province near Beijing, said the province aims to close 60% of its steel factories by 2020. That report sparked selling of steel-related stocks. Shanghai Hualian Mining was down 8.2%, and Shandong Jinling Mining lost 8%.

European Stocks Bounce A Little

Stock markets around the globe and oil prices has been pretty gloomy and they slumped to year lows last Monday. They are hit by continuous stress by shrinking global growth. However, European stocks has beat the odds and staged early bounce following last week's sell-off.

Since the United States markets are closed for the holiday (Martin Luther King Day), they don't have a chance to reverse the worst start in which main indices have lost as much as 10% in just 2 weeks.

Middle Eastern stocks plunged overnight, catching up with the fall across global bourses on Friday, while the prospect of a jump in Iranian crude exports after the lifting of sanctions against the country weighed heavily on oil.

Early Monday the FTSEuroFirst 300 index of leading shares was up 0.7%. Germany's DAX was up 0.6%, France's CAC 40 was up 0.4% and Britain's FTSE 100 was up 0.3%.

Gains at mobile telecoms gear marker Ericsson and luxury goods group LVMH floated the FTSEuroFirst off its 1-year low struck on Friday.

In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan fell to its lowest since October 2011 and was last down 0.3%.

Japan's Nikkei lost as much as 2.8% to a one-year low before closing 1.1% lower. It has lost 20% from its peak hit in June, meeting a common definition of a bear market.

MSCI's emerging stock index dropped to 6-1/2-year low on Monday, and was last down 0.3% on the day.

Shanghai Composite index closed up 0.4%, however it was still down nearly 18% this month.

On Wall Street the S&P 500 .SPX hit a 15-month low on Friday, ahead of Monday's market holiday.

In oil markets, Brent crude fell below $28 a barrel LCOc1 for the first time since December 2003 after international sanctions against Iran were lifted over the weekend, allowing Tehran to return to an already over-supplied oil market.

U.S. crude also slumped to 12-year lows CLc1, intensifying the pressure on U.S. energy sector "junk" bonds.