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China Big Cap Stocks Continue Slide Despite Another Liquidity Injection; Margin Debt Rises For 2nd Day

Tyler Durden's picture




 

"This has caused me a lot of heartache. It will take some time to recover," exclaims one disgruntled (and self-admitted greedy) Chinese investor who lost it all in the recent equity market demise. "It is forever a planned market, a planned economy," which as one China policy professor noted, means "the massive state intervention, especially preventing major shareholders from selling shares and going after short sellers, has damaged financial sector reform in profound and permanent ways." Having fallen over 4.5% from its highs into the close yesterday, the CSI-300 index and FTSE China A50 are both opening weaker as nearly 30% of securities remain halted and margin debt rises for the 2nd day in a row.

Following a major divergence in Chinese markets yesterday...

It seems high beta muppetry (ChiNext and Shenzhen) is being focused on for the save and the big cap SHCOMP and CSI-300 left more alone... which makes sense as Shenzhen is where the majority of halted stocks remain.

And the divergence continues today...

Some more liquidity injected...

  • *PBOC TO INJECT 20B YUAN WITH 7-DAY REVERSE REPOS: TRADER

But it's not helping.

And today it is following through weaker...

  • *CHINA'S CSI 300 STOCK-INDEX FUTURES FALL 1.2% TO 4,100
  • *CHINA'S SHANGHAI COMPOSITE INDEX FALLS 1% TO 3,929.32 AT OPEN

 

And FTSE China A50 is reverting lower rapidly...

  • *FTSE CHINA A50 INDEX FALLS 2%

 

And just as we warned earlier, they will never learn!!

  • *SHANGHAI MARGIN DEBT REBOUNDS FOR SECOND DAY AFTER STOCK ROUT

And PBOC weakened the Yuan by the most in 2 weeks.

 

Charts: Bloomberg

 

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Mon, 07/13/2015 - 21:24 | 6308860 44MagnumPrepper
44MagnumPrepper's picture

All HAIL CHINA CHUMBA

Mon, 07/13/2015 - 21:27 | 6308869 Bush Baby
Bush Baby's picture

Watch it climb when the firing squad takes out a dozen or so illegal sellers.

Mon, 07/13/2015 - 21:28 | 6308871 SHEEPFUKKER
SHEEPFUKKER's picture

Bro, sucks for you. You were living in a fantasy world. Get a clue. Have a nice day. 

Mon, 07/13/2015 - 21:28 | 6308872 FreeShitter
FreeShitter's picture

Bitches better start killing these sellers soon, fucking bastards!

/s

Mon, 07/13/2015 - 21:48 | 6308943 buzzsaw99
buzzsaw99's picture

mark it zero

Mon, 07/13/2015 - 21:49 | 6308952 laomei
laomei's picture

oh man, when is this tyler gonna get it, the chinese stock market is not the us one, it's not run by hedge funds or freqs.  it's a strange animal run by rumors and scammers.  the government is trying to clean out a bunch of that, which isn't a bad thing... imagine if the government in the us cleaned up the market in the us?  oh right, everything is linked to it and if it went down america would be over.

Mon, 07/13/2015 - 23:29 | 6309337 TheReplacement
TheReplacement's picture

Save me daddy.

Mon, 07/13/2015 - 21:55 | 6308966 nmewn
nmewn's picture

WTF!?!?

Doesn't China even have a damned website where the poor destitute investors can leave their assets, liabilities, savings, information with the government, having bought into the pyramid scheme of state sanctioned prosperity for all (thats Faaarrreeeee! shit for the uninformed) and can be made whole again by...spreading the losses out so to speak, ya know...socially...like ObaMao.gov or sumpin?

What the hell kinda operation are they running over there!?

Mon, 07/13/2015 - 22:00 | 6308979 disabledvet
disabledvet's picture

"Sorry...Bank Close Now!

No money for you!

Sorry!...

Mon, 07/13/2015 - 22:01 | 6308983 wains
wains's picture

Yujiapu, Yujiapu, Yujiapu....we hava probrem

Mon, 07/13/2015 - 22:03 | 6308990 skippy9
skippy9's picture

Chairman Mao killed fifty million Chinese during his rein of terror. Now the new regime will kill anyone who shorted Chinese stocks. Yet the lemmings continue to  flock to China with their money and the media morons continue to extol the virtues of China's miracle growth engine. Serves you right assholes who think Communism  is a  legitimate governing style. OH! I'm sorry Mr. Obama. You must know better since you're our President. ugh!

Tue, 07/14/2015 - 00:12 | 6309466 roddy6667
roddy6667's picture

For the factually deficient, Mao died in 1976. Most of his policies were reversed or  cancelled in the next few years. China has not been Communist since 1978. China is now ruled by those who suffered under the Cultural Revolution.

Have you ever been to China? Where do you get these "facts" you trot out to back up your beliefs? Do your handlers supply you withh regular updates, or do you just watch Fox News in your trailer.

Tue, 07/14/2015 - 00:56 | 6309550 Monetas
Monetas's picture

North Korea .... is still communist .... and China calls the shots in North Korea .... so, I'm going out on a leechee limb here .... China is still communist !

Tue, 07/14/2015 - 04:24 | 6309784 Dindu Nuffins
Dindu Nuffins's picture

I have mathematical proof that you are wrong.

 

Communism = state owns the means of production

 

SOEs = state-owned + enterprises

wherein an enterprise is assumed to produce things,

ergo and thusly, inasmuchas, to wit, and suchlike,

SOEs = state owns the means of production

and it necessarily follows that,

SOEs = Communism

 

Quod Erat Demonstrandum, my dear sir.

I don't even need to point out that all property purchases are 70 year leases with no freehold options.

Tue, 07/14/2015 - 06:00 | 6309865 TheCryptoShow.com
TheCryptoShow.com's picture

Oh, I thought SOE = State Owns Everything!

Wed, 07/15/2015 - 22:30 | 6314258 roddy6667
roddy6667's picture

A very large percentage of businesses are private. Most new business are private.If you ever went to China you would see it. Instead you choose to believe your recycled 1956 Cold War Propaganda. Ignorance. Capitalsim is rampant and very successful here. Not so in America.

About property ownership. I own a home in a gated community. The people (state) owns the land. This no different than a condo, apartment (owned), co-op, HOA, PUD, PAD in the US. I was a Realtor, landlord, and property renovator for years in America before I retired.The improvements on the land, the buildings, can be taken by the state after 70 years, IF THEY CHOOSE TO, Often they do not. In rural areas, homes sit for centuries. This is no different than eminent domain in America. However, you conveniently leave out the most important part. If the government chooses to upgrade  your home, you get a voucher for a new one. The 70 year timetable starts over. They also provide relocation assistance in the interem. I know dozens of people in the process right now. Everybody is excited about the free upgrade they are getting from the process.

All this blather about freehold is bullshit. In China there is no property tax. In Ameria you can never truly own the land, you only rent it from the government. If you don't believe me, try not paying your property taxes.

Why is a tax-serf quoting Latin? Is he trying to convince himself that he is n ot a slave?

Sat, 07/25/2015 - 16:01 | 6353630 Max Steel
Max Steel's picture

Filipino troll 

Mon, 07/13/2015 - 22:31 | 6309017 ThroxxOfVron
ThroxxOfVron's picture

"the chinese stock market is not the us one, it's not run by hedge funds or freqs.  it's a strange animal run by rumors and scammers.  the government is trying to clean out a bunch of that, which isn't a bad thing... "

China is run by the Party.  

IF the Markets are run by rumors and scammers it is because that is what the Party leadership have decided and insisted upon.   The Party leadership can shut down part or all of it -as they have been doing on an ad-hoc basis, 'clean out' as much of it as they like, reform/alter/re-wriite rules for it, etc. -at will any time or every fucking day of the week...

IMHO, the Party Leadership itself is using these fraudulent so-called markets to divest their citizenry of their accrued productivity and investment gains via pump and dumps, accounting fraud, prohibitions on selling, margin yoyo-ing, etc., etc....

It's a scam run BY & FOR The Party Bosses and their 'Princelings'.

 

One of the best ways to know for certain if you own an asset is to sell it when you want to at a price that you freely agree to, or not to sell no matter what is offered in exchange...

IF you are NOT ALLOWED to sell an asset you wish to at the price you freely agree to, or if you are NOT ALLOWED to refuse to sell: you don't/didn't really own the asset.

 

Mon, 07/13/2015 - 22:13 | 6309024 SpasticGramps
SpasticGramps's picture

I don't see what all the fuss is about. CNBC has over the course of the past week given me "5 Great Chinese Stocks Set to Rebound" like every fucking five minutes.

They must know something right? Them and the illiterate Chinese farmers, same difference? So I went and took out two mortages on my paid for home, got some unsecured loans from a trusted online source, and have it all leveraged up through one of China's P2P margin programs that lets me get up to x15.

Mass suicide bithez.

Mon, 07/13/2015 - 23:59 | 6309422 Fish Gone Bad
Fish Gone Bad's picture

CNBC had Erin talking about the merits of investing in Afghanistan right after they discovered billions of dollars worth of opium and raw materials.

Tue, 07/14/2015 - 03:25 | 6309744 Kiwi Pete
Kiwi Pete's picture

Classic! What could go wrong?

Mon, 07/13/2015 - 22:12 | 6309028 Dragon HAwk
Dragon HAwk's picture

so none of those smart  Chinese programmers was able to copy our HFT algo  programs ? man how backwards are they over there..

 don't they know it doesn't matter whether it's going up or down  as long as it moves you make money.. darn rookies.

  " We only open  part of market going up. " which side of Market you wish to Seat on Today?

Mon, 07/13/2015 - 22:17 | 6309050 rlouis
rlouis's picture

The herd is trying to decide whether or not to play in the crooked casino and try and win.

Odds aren't good.

 

Mon, 07/13/2015 - 23:49 | 6309404 MarkGoldman
MarkGoldman's picture

Thank gawd for the Greek distraction!

Tue, 07/14/2015 - 00:06 | 6309449 Puncher75
Puncher75's picture

I'm long the earth right now on margin. Wish me luck ;-)

Tue, 07/14/2015 - 01:01 | 6309562 SpasticGramps
SpasticGramps's picture

I tell my tree hugging acquaintances that if the "environmentalist" had any sense they would be camping outside of the central banks. Any system that allows for trillions of dollars be conjured out of thin air, resources to be plucked from the earth to build shit no one needs, is bound to royally fuck up at some point. 

Look all these McMansions and Cities that no one lives in. All because some fuck with a computer can print billions with a keystroke so his banker buddies can securitize it and sell it to some illiterate Chinese farmer or some illiterate Mary Kay lady driving a pink Cadillac who lives in a fucking MacMansion.

I'm long the human species walking hand in hand into extinction.

Tue, 07/14/2015 - 02:26 | 6309683 franzpick
franzpick's picture

Watch post-recovery new lows being made here in China CSI300 futures, down 5%.  Click 'Majors', 'More', and CSI300 or China A50 to see the possible next leg of the collapse live:

http://www.investing.com/indices/us-30-futures-advanced-chart

Tue, 07/14/2015 - 06:06 | 6309874 vyeung
vyeung's picture

For all the things it has done right, this intervention is no doubt BAD! Allowing multiple accounts/margin accounts without a proer governing framework was a HUGE mistake. They truly FARKED UP this time.

Tue, 07/14/2015 - 06:51 | 6309926 Raul44
Raul44's picture

Go on chinese, kill your own people and their savings for stocks - idiots ;). 

Tue, 07/14/2015 - 06:51 | 6309927 matagorda
matagorda's picture

China -- God's gift to libertarians and occupy wall street alike.  China does fiscal stimulus and pours more concrete in five years than the U.S. did in the entire 20th century.  Then when that flops they do monetary stimulus and the stock market doubles in 6 months.  The ultimate Keynesian farce and truly deserving of a Nobel for real-time ecocomic experimentation on an unprecedented scale (at least since the great leap forward and the cultural revolution, anyway).

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