The headlines out of China’s $9 trillion stock market are chilling. In the first three weeks of January, the MSCI China Index has already lost 9.7%, extending 2023’s pain. Traders were rushing to unwind their bets on electric-vehicle companies. Blue-chip consumer tech platform Meituan briefly dipped below its 2018 public offering price.

The blame game has already begun. Fingers were pointed at technical factors. The government’s “window guidance” to mutual funds telling them not to sell stocks in the final weeks of 2023 may have delayed their portfolio rebalancing until January. The wealthy’s losses on “snowballs,” derivatives that essentially bet on range-bound index trading, may have prompted brokers to unwind their long hedging positions as well.

QOSHE - No, China’s Market Crash Has Nothing to Do With Trump - Shuli Ren
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No, China’s Market Crash Has Nothing to Do With Trump

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19.01.2024

The headlines out of China’s $9 trillion stock market are chilling. In the first three weeks of January, the MSCI China Index has already lost 9.7%, extending 2023’s pain. Traders were rushing to........

© Bloomberg

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