China investors brace for stock market free fall

Joanna Chiu

Beijing (dpa) – China has rolled out a dizzying array of stimulus and loosening measures this year, including multiple interest rate cuts and this month’s surprise yuan devaluations.

But investors are increasingly showing signs that they don’t believe the government will be able to bolster growth as the world’s second-largest economy slows down.

“I have sold off most of my China shares and I am planning to invest in overseas companies instead,” said Mason Zhao, a Beijing-based investor.

On Monday, the benchmark Shanghai Composite Index dived 8.49 per cent to close at 3209.91 points. It was the biggest one-day fall since February 27, 2007 during the global financial crisis.

The tumble followed a tumultous week that saw the index fall 11 per cent.

“China is trying to adjust to a transforming economy, but it is going to be difficult to improve the situation,” said Hu Xingdou, professor of…

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