Chinese shares plunge again
Chinese shares plunge again
30/05 19:07 CET
There has been another plunge in Chinese stocks after the Beijing government moved to cool the red hot market. It did that by raising taxes charged on trading shares. The tax was tripled and equity prices suffered their heaviest fall in three months. More than half of the top shares on the Shanghai market fell by their daily limit of 10%. Shanghai's Composite Index finished the day down six and half per cent.
It had hit a new record on Tuesday, having risen 62% this year and it has quadrupled in value since the start of 2006. Investment advisor Major Teng said he thinks the government wants to put policies in place to control the short term acceleration of the market, which is a good thing in terms of a correction of some overheated stocks, but he doesn't think that that will stop the upward momentum.
The last time the Shanghai index fell dramatically - by almost nine per cent in February - it led to a five-day world-wide sell-off of shares. This time the reaction was much more muted. In February Chinese shares quickly bounced back and resumed their meteoric rise. Analysts said this time the recovery is likely to be slower and some think the market could slip further in coming weeks.
Chinese stocks have been boosted by strong demand from millions of domestic investors, many trading shares for the first time. Some have even mortgaged their homes or used their retirement savings in the hope of getting rich quick.
http://tinyurl.com/2q6d5e
30/05 19:07 CET
There has been another plunge in Chinese stocks after the Beijing government moved to cool the red hot market. It did that by raising taxes charged on trading shares. The tax was tripled and equity prices suffered their heaviest fall in three months. More than half of the top shares on the Shanghai market fell by their daily limit of 10%. Shanghai's Composite Index finished the day down six and half per cent.
It had hit a new record on Tuesday, having risen 62% this year and it has quadrupled in value since the start of 2006. Investment advisor Major Teng said he thinks the government wants to put policies in place to control the short term acceleration of the market, which is a good thing in terms of a correction of some overheated stocks, but he doesn't think that that will stop the upward momentum.
The last time the Shanghai index fell dramatically - by almost nine per cent in February - it led to a five-day world-wide sell-off of shares. This time the reaction was much more muted. In February Chinese shares quickly bounced back and resumed their meteoric rise. Analysts said this time the recovery is likely to be slower and some think the market could slip further in coming weeks.
Chinese stocks have been boosted by strong demand from millions of domestic investors, many trading shares for the first time. Some have even mortgaged their homes or used their retirement savings in the hope of getting rich quick.
http://tinyurl.com/2q6d5e
bin66 - 1. Jun, 01:07
