Macro View

A-share distress

  • Published 20 May 2010

Is the recent frailty of China's A-share market – which at the time of publication was down by nearly 20% since April 16 – a harbinger of what is in store for the wider economy later this year?

It is hard to say, particularly as investors give conflicting readings on the impetus behind the slump. Some say inflation is the main problem, and the spectre that interest rates will be raised. Others say the cooling of the property market is to blame. Still, others see local municipal investment companies as a malignant presence spooking sentiment.

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