Wednesday, June 25, 2014

Shanghai: A Chart for Concern

SSEC(Shanghai Stock Exchange Composite Index) is a major China index and trading in a continuous downtrend since December 2013. During the same time other major international indices like DJIA, S&P500 and our NIFTY also showed stronger upmove and trading at their life time high.

          One of the major problem behind this is "Failure of China property". According to an article from Bloomberg an amount of around 109 billion yuan (around $32.7 billion) of wealthy individuals are stuck in property. It is freezing liquidity in chinese market especially in real estate.

          There may be corrections in the property market of some cities and the weakening property sector will definitely have a big impact on the financial system.

           Overall it indicates, Chinese market is not in an uptrend, under performing international indices.

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