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In China, Shanghai and Shenzhen stocks both fell on Tuesday,
closing at the lowest level in four years.
The Shanghai Stock Exchange Composite Index fell even
below 2,000 points, and investors generally lost confidence.
Some mocked after the Chinese Communist Party (CCP) 18th
National People's Congress (NPC), SSE easily fell below 2,000 points.
Please see the following reports.
In Tuesday (November 17), China's stock market opened
lower and fell, including Shanghai and Shenzhen stocks.
The Shanghai Stock Exchange Composite Index fell below
the psychological threshold of 2000 points to 1991.17 points,
down 1.3%, which is the lowest within the last 46 months.
The Continental Finance Media sighed, China's stock market
return to '1' (sounds like 'e' in Chinese) era.
Another stock market, the Shenzhen Component Index,
fell below 8000 points upon opening,
and at intraday was at 7931.74 points, which also
refreshed the lowest records in the past 4 years,
and finally closed at 7936.74 points,
down 0.99 % compared with the previous trading day.
Although the National Bureau of Statistics released
the day before for the first 10 months of 2012,
national-scale industrial enterprises realized profits on
their year-on-year growth of 0.5%.
On the other hand, the central bank carried out their
13.5 billion Yen reverse repurchasing operations.
But the market reaction to these messages was numb,
the market still declined.
Based on domestic financial media analysis, market concerns
about long-term economic trends and year- end funding being tight are the main reasons for stock decline.
Beijing Normal University MBA faculty and
economy columnist Duan Shaoyi analyzed,
although there were economic data, the profitability of
the business situation has not improved at all.
Many companies listed just to collect funds
without considering investor returns.
Duan Shaoyi said: To invest in stocks, we should be optimistic
about the future of the business, and its current profit level.
The majority of companies have a low profit margin,
and their rate of return is even less than the benefits of economic growth.
So to invest in such a stock market, one must lose,
because the stock market does not deserve that price,
and they bought in at a higher price than its true value.
Domestic media said, over 90 % of the investors in China
made a loss in 2012. But investors said it was beyond that.
Guangzhou investor Mr. Shi said: a 90% loss is conservative,
it should be over 95 % in losses.
It fell to 1991 points, and people don't have much
confidence in the market.
Many channels in issuing and financing were very opaque,
very dark, so that people's confidence has collapsed.
China's stock market has been criticized for the existence of
institutional problems, "re-financing, but neglecting delisting and regulation".
There are endless accounts of insider trading,
and stock market irregularities, criminal penalties seem to be non-existent,
making China's stock market a world capital market
with the strongest financing capacity,
but the lowest return in the secondary market,
which is a one-way freak malformation.
Guangzhou investor Miss Leung: "Since in China's stock
market, there are mainly poor people, the government does not care anymore.
The GDP is growing, but all of it is flowing towards those
rich officials, who transferred that money to foreign countries when going abroad."
Although domestic analysts believe the situation is not so
pessimistic, and it won't last long below 2,000 points,
investors in China have been generally expressing,
a show of no confidence.
Liaoning investor Miss Chen: "When it was above 6000 points,
many people, many old ladies went to the (stock market)!
In the end, some lost their money or even in some cases
losing all their money. It was so common.
Now it has fallen to 2000 points, who will go to
the stock market now? Everyone will lose there."
Guangzhou investor Mr. Shi:
"We cannot be optimistic, because it is common.
Moreover, the state scrapes the skin,
followed by the agencies and dealers scraping more hair;
then the QFII, which is the foreign investment.
They all plundered the shareholders' funds."
Taiwan media quoted words of Liu Jingde, the
deputy GM of China Cinda Securities R & D center:
During the 18th NPC, those stable plate potential securities
and property stocks, now are also in decline with less buying, increasing the decline of stocks in China.
Investors in China have a left message on the stock market
professional forum and ironically said:
After the 18th NPC, the SSE easily fell below 2,000 points.