SHANGHAI - China's investors have waited five years for stock values to return to US$10 trillion, a milestone that would seal the market's recovery from its biggest crash in history.
But the US$10 trillion level also marked the top of the bubble five years ago, a memory that's still fresh in investors' minds. Similarities between now and then have started to displease policy makers, who have taken steps to rein in stocks: Shanghai's large caps slumped on Friday after two government funds said they plan to sell shares.
"The upward trend remains intact," Mr Hong, Bocom's head of research, wrote in a note."The general mantra from the top remains supportive of the market. It helps the domestic sentiment, strengthens the national resolve, and finances capital investment into new and innovative industries." This time around authorities appear keen to engineer a steady bull market. At 1.3 trillion yuan as of Friday, leverage is barely half the level of its 2015 peak while valuations are still relatively cheap compared to other stocks globally.
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Source: BusinessTimes - 🏆 15. / 51 Read more »