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IPFS News Link • China

China's Stock Market "Appears To Be In Free Fall Now" – Will The U.S. Stock Market Be

•, By Michael

Today, the global economy is more interconnected than ever before, and economic warning signs have been popping up all over the planet in recent weeks.  Of course the U.S. has certainly not been an exception.  Employers are throwing workers out into the streets in very large numbers, and we have reached a point where hunger, poverty and homelessness are all growing at extremely alarming rates.  The U.S. economy has clearly entered a very troubled period, but for the moment U.S. stock prices are still stable.  Unfortunately, the same cannot be said about Chinese stocks.  In fact, Newsweek says that China's stock market "appears to be in free fall now"…

After a rocky couple of years for the Chinese economy, the country's stock market appears to be in free fall now, with authorities asking institutional investors not to sell stocks in an attempt to stabilize share prices as foreigners are pulling out.

Compared to 12 months ago, the FTSE China 50 index is down almost 30 percent

The FTSE China 50 index—a real-time tradable index comprising 50 of the country's largest and most liquid stocks—has plunged by 1.77 percent between Monday and Tuesday as part of a long-term large decline over the past six months. Compared to one year ago, the index is down by 29.24 percent.

China's market regulators have tried to stabilize the market by imposing restrictions that stop some investors from being net sellers of equities on certain days. This strategy—with authorities offering what's known as "window guidance" in an attempt to help the country's stock market bounce back—was first introduced in October.