China’s stock-market collapse is not over yet

The collapse in China’s stock market is far from over despite the Shanghai Composite Index having fallen nearly 30% in about a month and experts are urging investors to bail out while there is time.

“We continue to advise investors to consider not holding individual positions in Chinese stocks but advocate for fully diversified exposure to emerging-market equities,” Peter Donisanu global research analyst at Wells Fargo Investment Institute said in a report to investors. Continue reading

China “Crosses Rubicon” With Stock Bailout; BofA Says PBoC Risks “Hurting Its Credibility”

Earlier today in “Panic: China Central Bank Steps In To Bailout Stocks As Underwater Traders Pray For A Rebound,” we noted (without much surprise) that the PBoC has officially taken the plunge. Late on Sunday, the China Securities Regulatory Commission announced that China’s central bank is set to inject capital into China Securities Finance Corp which will in turn use the funds to help brokerages expand their businesses and reinvigorate stocks. Translation: China’s central bank is now underwriting brokers’ margin lending businesses. Continue reading