I believe things will get worse in the coming days.
Artificially boosting the stock market will not stop the rot as the Chinese investors found out to their dismay yesterday - China market tumbled 8.5%, calling into question Beijing market rescue effort.
I'm just a layman in China market but I suppose when the stock market rebounded sharply after the initial 30% slide, those investors who did not get the chance to sell earlier gratefully just did it and this just snowballed into a collapse.
How sad.
Earlier there was an article I put up in this blog saying that the Chinese regulators were using the wrong ways by forcing the listed companies and stock-brokers to artificially support the sagging market.
When that support waned or stopped, that is what the rumors said yesterday, the market tanked.
According to the CNBC data I saw, the Shanghai Composite Index (SSEC) on the Shanghai stock exchange this current drop lowest point is 3,421 on 8/7/2015 which I think is the temporary chart support at the moment.
I personally think there is no way this support will hold.
When this happens there will be another round of panic among Chinese investors. I think they are not used to this type of volatility as most are newbies.
BBC news describe the mayhem in their report here.
The meltdown has affected the sentiment in KLSE but I'm not too sure that it's all due to China, world economy, drop in commodities prices or due to our own internal problems like 1MDB.
Maybe its' a bit of everything.
soojinhou
The first mistake China made was to encourage people to jump into the overheated stock market. The state have no business meddling in free market. At most, the state is responsible to deflate bubbles, not inflate it more. As such, the government now feel obligated to support the market using public funds. If it didn't asked people to jump in in the first place, the bubble wouldn't get so big and they don't have to save the retail investors now. It's a really poor judgement from the Communist Party.
2015-07-28 11:04