"This has caused me a lot of heartache. It will take some time to recover," [5] 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...
[6]
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...
[7]
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
[8]
And FTSE China A50 is reverting lower rapidly...
- *FTSE CHINA A50 INDEX FALLS 2%
[9]
And just as we warned earlier, they will never learn!! [10]
- *SHANGHAI MARGIN DEBT REBOUNDS FOR SECOND DAY AFTER STOCK ROUT
And PBOC weakened the Yuan by the most in 2 weeks.
Charts: Bloomberg
