China’s stock market crash
China’s stock markets are suffering from massive volatility and investors are running scared. If you’re just catching up to it, here’s what canadian goose jacket you need to know. Last updated: August 27, 3:30 am ET (7:30 am GMT). 1) China markets stabilized on Thursday as investors in Asia joined a global stocks rally. The benchmark Shanghai Composite closed up 5.3%, while the smaller Shenzhen Composite added 3.3%.
2) The performance comes after a series of wild trading sessions. Before rebounding on Thursday, the Shanghai Composite had lost more than 20% over the previous five days.
3) canada goose clearance The sharp declines were terrible news for officials in Beijing, who had been trying desperately to Canada Goose sale support cheap Canada Goose stocks.
4) The root cause of all the turmoil: Over the past year, investors poured canada goose more and more buy canada goose jacket into canada goose uk black friday Chinese stocks, even though economic growth and company profits were weak.
5) Retail investors think mom and pop, average folks were the most enthusiastic. A classic bubble developed.
6) The bubble popped on June 12, and the Shanghai index lost about a third of its value before rebounding. Losses were even more dramatic on the smaller Shenzhen Composite.
7) China moved aggressively to control the crisis. The government gave money to brokerages to buy stocks and ordered company executives not to sell Canada Goose online their shares. New company listings were suspended. The central bank cut interest rates to a buy canada goose jacket cheap record low.
8) Regulators and security officials launched an investigation into illegal canada goose black friday sale short selling borrowing stocks so youcan trade them in the hope they fall and rumor mongering. Only approved brokers are allowed to engage in short selling in China.
9) For a while, Beijing’s plan appeared to work, but the Shanghai Composite has resumed its decline. The index has dropped more than 40% from its June uk canada goose outlet 12 peak, erasing all gains year to date.
10) canada goose uk shop Foreigners own just 1.5% of Chinese shares, so your portfolio is unlikely to be directly affected. Still, economists are worried that stock losses will ripple through China’s economy, and take a bite out of consumer spending. Gold, copper and other commodity prices have uk canada goose been affected.
11) The government’s goal is to minimize damage to the real canada goose store economy, and Beijing still has policy tools it can use to support growth. The central bank has cut interest rates and lowered the amount banks are required to keep on canada goose uk outlet reserve, making it cheaper to take out loans and easier for banks to lend. Other options include boosting infrastructure spending canada goose coats and slashing taxes.
12) However, there are signs of weakness spreading through China’s manufacturing sector. On Friday, a key gauge of China’s manufacturing activity tumbled to its lowest level in 77 months.
CNNMoney (Hong Kong) First published July 9, 2015: 6:52 AM ET
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