I just saw some news crossing about Citic Securites, the largest broker in mainland China. They are closing their prop desk due to losses estimated at 3B yuan this year. The culprit was the 23% drop on the Shanghai Composite index.
I would also shut down a desk that could only make money on the long side — the chart looks like its heading to the 2008 lows.
AUD would be the obvious casualty of a further slowdown in China but moves by the govt to cut rates or invest in the economy would spark a snapback.
The SSEX is set to open down 0.39% today.
