When to See the Rebound of China’s Stock Market-.doc

When to See the Rebound of China?s Stock Market? The Chinese stock market is the strang- est one among all stock markets in the world. Usually the stock index can grow along with the economy, but it is not a case in China. Of course, not all countries?economic development is positively related with the trend in their stock markets. However, normal analysis and ordinary forecast do not work for the Chinese stock, which can be said to be a “maze”. The Chinese economic size (based on its GDP) increased by 500% from 1.453 trillion US dollars to 7.298 trillion US dollars in ten years. By contrast, the index in the Shanghai Stock Exchanges increased from 1,640 points to 2,170 points with only a 27% increase in the same period. In 2007, the stock index once hit the ceiling of 6,000 points, but the grace was soon lost thanks to the international financial crisis in 2008. Recently, things are getting worse. In September, the US government launched the 3rd round of quantitative easing, causing the global stock market to rebound. But the Chinese stock was not included. And, when people think it could not be lower, another round of fall began. From this year, the Shanghai Composite Index already fell by 8%. This is lower than the stock index in August and September 2011 during the stock slump caused by the European debt crisis and the lowered US sovereign credit ratings, and close to the lowest point in 2008 when the financial crisis was sweeping the world. Many Chinese individual stock investors are so desperate that they want to the leave the stock market. When and where did the Chinese stock market get wrong? Then, when will the real rebound occur since the stock market has been in the valley for such a long time. Korean financial magazine Weekly BIZ had its own interpretation of the Chinese stock market – the most mysterious financial market in the world. From August 2009 to now, the US Standard Poor 500 increased by 45% or so in three years. In comparison, the