China Stock Market Still Corrected Before Holidays

China shares slipped back on the last day of their trading this week amid fears that government measures to shore up equity will fail because of the economic slowdown is deepening.

Shanghai Composite Index down about 2.3%, to 3,091.99 at 09:37 pm, the weakening add downfall that is large enough in the last two days. About 18 stocks fell for every one that rose on the index shares shares. China's financial markets will be closed tomorrow and Friday for a holiday to celebrate the end of World War II, which may be characterized by large-scale military parade in Beijing.

Benchmark stock index extended losses from the biggest loss in two months since 2008 after the trader reduce the stake they bought with borrowed money for the last 11 days of the government and its manufacturing index fell to the lowest reading in three years. Shares of large companies rebounded in the last five trading days from the lows of the session amid speculation of purchases by government funds.

Ananlis of one of the securities in Shanghai said that the government seems to be buying shares in blue chips today to support the market but investors have lost trust in the middle of the action that is still ongoing deleverage. He added that the correction in the equity is still not over.

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