Chinese Stocks Enter Bear Market Following 2 More Defaults Overnight

Tyler Durden's picture

Following the default of 2 more corporations last night, Hang Seng's index of China Enterprises plunged to 8-month lows and officially entered bear market territory. Overnight angst in the Chinese currency markets (which saw the Yuan trade back to 1-year lows) has sparked broad commodity weakness (as CCFD unwinds en masse) with copper giving back most of yesterday's major short squeeze gains back. Chinese corporate bond prices also tumbled to one-month lows.

Hang Seng's China Enterprise Index (the most liquid vehicle for trading Chinese stocks for foreigners) has entered a bear market


as cash-for-commodity financing deals continue the unwind,


Charts: Bloomberg

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The worst trader's picture

hasta la vista baby! Lets see how long yeller can prop it up

prains's picture

....will she use her hands??

TruthInSunshine's picture

China (2nd largest global economy with most leveraged debt issued in last 5 years & septic economy) is melting down in what the Chinese Authorities hope to manage via a somewhat "controlled demolition."

Back to coverage of Kabuki Theater sanction & ban YOU! lists discussed by Obama regarding Crimea.

Vampyroteuthis infernalis's picture

Obammy will never tell his libby corporate overlords that Commie China is a sham. He is not bright enought to figure it out himself. They are going to find out the hard way through max pain.

EatYourCornTakeyourPill's picture

Time for Chinese leaders to improve their approval ratings by annexing the senkaku islands.

Deathrips's picture

Well then.....

The Chinese, have been playing this game for a long time. Remember they invented FIAT. They have a lot more practice than the rest of the world. Thats why they are buying gold, real assets, farmland..and water rights. They already have a manufacturing base..and Who knows what else?

Which begs a question. Why do you need fiat when you have used fiat to create real sustainability? I dont think they do... they may be throwing other currencies that didnt use the FIAT right the wolves. ????

Im not banging a gong here...but I doubt they will go down first.



Dr. Engali's picture

As long as Twitter enters a bear market and stays there through May I'm good.

ebworthen's picture

China can survive a credit/housing unwind; not sure Wall Street can.

PlusTic's picture

yea, no fukkin central bank sponsored algos over there yet...

Mr Giggles's picture

China says, give me everything for paper.

starman's picture

China has ghost City's! Big fucking deal! Malaysia has ghost airlines!

Big fucking deal USA has ghost jobs ghost healtcare and a ghost financial Systems! There take that!

yellencrash's picture

I can't believe US stock markets have dodged the bullet so well. It's surreal to me.

delivered's picture

Yellen. My view on the US equity markets are they are usually the last to get the message and leave the party. Back in 2007, the cracks in subprime/MBS were evident in early 2007 but the market didn't really first choke until late in the year and then really got a case of the "runs" in 2008 and 2009. Prior to this in the bust back in 2000, again the signs were all present in 1999 and early 2000 (e.g., Fed aggressively raising rates, Brazil currency crisis, Euro launch and falling to parity with the USD) but the market's kept rallying. 

So here we are again. Major policy changes by the Fed (i.e., taper), EM's in turmoil (e.g., Turkey), crisis in Ukraine, a credit market in China that represents the mother of all clusterfucks, and still, the market doesn't react. I'm looking for a 6 to 12 month lag until the market really is forced to accept reality. Until then, the equity markets will most likely scale every wall of worry until its too late.

css1971's picture

Amerians are optimists not realists.

Let them eat iPads's picture

There's an old saying in China:

"He who raffs rast, raffs roudest".


Who's raffing now, bitchez?

RevRex's picture

Clash coming, rickety sprit!


What a rorraparooza

hugovanderbubble's picture

SHORT 100% ES 1873 TILL 1500