Tuesday
Jun292010
The China Bear Gets Worse
Tuesday, June 29, 2010 at 09:29AM China's Shanghai Composite made a new bear market low today after breaking significantly below levels that had been acting as support in recent weeks. China has now been in a bear market for nearly a year already. The index peaked out last August 4th, and since then the index has declined a whopping 30%.
Reader Comments (3)
The Shanghai Composite dived 4.3 percent to a 14-month low of 2,427.05, as investors fretted that Agricultural Bank of China’s record-breaking initial public offering will draw money away from other stocks and depress prices overall; the IPO, which has separate listings in Hong Kong and Shanghai, is expected to raise $23.2 billion, making it the world’s largest, reports Colleen Barry of the Associated Press in article World Stocks Slide Amid Euro Zone Debt Worries.
The three month chart of the Shanghai Composite compared to Base Metals, DBB, China, FXI, World Shares, ACWI, and the Double Long Yen ETF, YCL, shows that the Shanghai shares sold off very strongly in mid-April as the China Central bank announced credit tightening policies to curb real estate speculation, and as currency traders unwound carry trade investments in base metals, DBB.
The one year chart of the Shanghai Composite compared to Base Metals, DBB, China, FXI, World Shares, ACWI, and Spain, EWP, shows that the Shanghai shares and the Spanish shares are leading the way down into Kondratieff Winter.
This is what you get when you bailout banks that deal in fake mortgages and drug dealers. Watch as American turns into a underground economy , just like Greece. Who wants to pay taxes (extortion) to a bunch of crooks.
The VIX is still under 40 and the Dow is down only 225 as i write. O% -.25% interest rates. Europe having failed auction. Police, Firefighters And Teachers being laid off.
This is not Good for Anyone !
Knowing that the Chinese index is a precursor to three months, the raw materials are likely to suffer