If we see what has happened for A50, it is a pathetic picture. Since the reduction in stamp duty that led to Shanghai index jumping up over 5 percent and hitting above 3200 and A50 jumping above 13100 points, a50 quickly retraced.. now the benefit from price jump for A50 all the way from 12250 to 13100 has been fully eroded. $FTSE China A50 Index - Oct 2023(CN2310)$ $Tiger Brokers(TIGR)$ $Futu Holdings Limited(FUTU)$ $Tesla Motors(TSLA)$ $NVIDIA Corp(NVDA)$
Not only is it here, the breach of the support of 12250 and then 12100 and then 12000 is really worrying...
Now Shanghai index is down to 2983 and broken below 3k points..
To be frank as a long term investor in Chinese stocks, it is a journey that I once thought I see the light at the end of the tunnel.. however, the mixed signal sent out last week relating to formal guidance to brokers not allowing chinese citizens to buy overseas shares is giving the shortsellers excuses to flame the storyline of bearish Chinese stocks .. this movement is totally unnecessary as it is already an informal guidance to the brokerage firms.
Now if you see the movement, the a50 tanked rapidly from 12450 all the way to 11650 now...
If China does not rapidly come out with forceful stimulus measures, it will be very worrying as the downleg and more downlegs cannot be avoided. For this, I am also in a loss for such position. This does not make any sense for global investors to keep pouring money into Chinese stocks when we thought we can finally see returns but the mixed signal is giving the shortsellers the narrative to manipulate market sentiment to shortsell Chinese stocks.
Will Chinese authorities announce any measures in terms of concrete details to support the china economy and to help the capital markets this weekend?
They are really not fast in terms of actions and I certainly hope they are united to be prompt to help the economy and markets.
As always, this should not be construed as any investment or trading advice.
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