HONG KONG — Chinese stocks are displaying a contradiction. How is it that a market on which so many fund managers are so persistently bullish has plunged toward correction territory?
The CSI 300 index, which tracks the biggest shares traded in Shanghai and Shenzhen, climbed 27% in 2020 — showing the impetus expected from the world’s only big economy to grow during a pandemic-hit year.
Since the index raced to an intraday record on Feb. 18, however, it has lost 15% of its value — even though China’s economy continues to rebound, as evidenced by the 18.3% year-on-year growth in first-quarter gross domestic product that Beijing reported on Friday.
The decline is the sharpest for the CSI 300 since the COVID-induced global fall last March. The lack of support from both local and global investors is fanning memories of the crash six years ago that erased half the value of the index. Read more…..
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“We’ve got two markets: one is a house of pain, the other’s a house of pleasure,” the “Mad Money” host said.