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China stems stocks rout, but market faces lengthy hangover

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By Koh Gui Qing and Kazunori Takada

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Chinese authorities need to understand that some assumptions/parameters/rules of the market should be respected and not changed so easily including:

Government should not blow and inflate a stock bubble. Government is not bigger than market. Retail investors behave in herd and are self-destructive as a group. 90 million retail speculators is sheer madness. Obviously compliance at regulatory and securities firms are lax. Stock investing should be institutionalized with value investing and long-term approach to provide stability. It is not criminal to sell short futures market. Stocks listed should not be stopped from trading unless its for compliance and major corporate announcements.

Confidence and trust will be broken when above are not respected. Chinese stocks probably need to be re-rated lower. Both entry and exit routes into stock markets are not properly institutionalized. Chinese stock regulators have a long way to go.

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The CSRC, which warned on Wednesday of “panic sentiment” gripping a market dominated by ordinary retail investors, said it would deal severely with any shareholders who violated the restriction

Well who would have guessed it? ...Its simple, if that is any issue with the free market, just remove any element that 'free' about it.

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Haha like I have been saying for a number of years China is either going implode/explode or BOTH!!

THIS is just a taste of what could happen, with what the govt is doing.... how much damage will they cuase, only time will tell.

But one thing is for sure China is going to be in for a rocky road, then the world will sadly see what the red army is REALLY for! I feel sorry for ordinary Chinese people, they deserve better!

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This is why Communist Countries like China sooner or later (sooner rather than later) need to recess their markets and sell off.

You NEVER Bull-Run your Markets without having a Major Sell Off of stocks or fall back into a Recession to cool off your markets.

China's market has been so strong in the past 12 Years thanks to the outsourcing of American Jobs to China and China's continuing "Cheap Labor Market" plus over 90 Million Chinese who own personal stocks, and that is fine, but they didnt to SELL when it's time to SELL.

Instead they simply withheld their stocks in hope that their values would increase in order to sell later at a heigher value and without a timely sell off or a recession - All the Foreign Investors Bailed on them and now the Chinese Government just placed a 6 Month Ban on selling off any stocks. Now they can't sell anything and their stock values will soon deflate.

LOL - Can't wait to see the final outcome when 90 Million Chinese will soon learn that their stocks aren't worth spit, people's money lost on a stagnated & deflated market, and the Juan starts sinking like a stone cast into the sea.

In the meantime, the Japanese Yen is gaining momentum on the Juan and the U.S. dollar needless to say.

Get ready for the riots Beijing.

BTW China, still not interested in that Democracy thing?

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Doomsayers are much more active these days. Expecting Chinese stock market crash is unlikely. Chinese stocks had increased 160% since last year so why are we concerned about a drop of 30%? What the Chinese government concerned about is panic selling that will create instability in the market. The market will not crash as long as the government is in control so try not to think like it is in the free market economy. Forget about the fundamentals for now, it doesn’t work in this case, better to watch what the government is doing or trying to do. So when the Chinese government says the stock will go up, it will go up. China is in the process of funnelling more money to the middle-income earners through the stock markets so expecting more millionaires to be created every day. When people have more money they will spend more so in turn the economy will get better and better. Manufacturing sector will benefit as the value of Yuen is lower so the export will improve. So, don’t expect a rich and controlled economy like China to implode or explode any time soon.

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flowers JUL. 10, 2015 - 05:08AM JST Forget about the fundamentals for now, it doesn’t work in this case, better to watch what the government is doing or trying to do. When people have more money they will spend more so in turn the economy will get better and better.

Tightening the rules for transferring large amount money out of the country might become a reality for Hong Kong. China’s regulations forbid individuals from moving more than $50,000 out of the country per year, but that’s a rule that’s often evaded, frequently by using Hong Kong. Funds don’t actually cross the border, but the clients essentially moved money from one jurisdiction to the other, evading the $50,000 limit. In a future, Chinese government might set up a same rule for Hong Kong that forbids moving more than $50,000.

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I got up early this morning in Hong Kong to watch the stock market in China, which should start in less than an hour.

With all the measures that the central government has put in place to stop the slide, I expect the market this morning to be little more than a ZOMBIE, listing a little bit higher then a little bit lower. This won't last, of course. The large investors have all been handicapped by the CCP from selling their shares or into purchasing more shares to keep the level rising, even if modestly. These are the suckers who are about to lose their shirts.

Why? Because it's the little investors, your regular Mom and Pop, that set the stock market blazing with their small purchases of stocks into a stock market bubble. After seeing the modest recovery from last week as their last chance to salvage whatever they can from this giant casino that nearly drove them into poverty last week, you can bet that they're going to start pulling out their stock market gambling money in the next few days. Why, because the governments can't control the markets for long. You know that. In fact, the little Chinese investor knows the bloom is off that rose...and he’s running scared

Hello, the Great Depression in China, which follows the continuing slide of the Chinese Stock Market Crash from 2015 through 2017, nearly the same as our 1929-1932 Stock Market Crash in the US with our own Great Depression lasting a decade of bread lines and fuel lines!!!!!!!!

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