Market Trends and Performance
Like emerging markets elsewhere, China’s equity markets have proven quite cyclical and, in the midst of that cyclicality, extremely volatile. The market’s character reflects the influence of two factors: (1) investor sentiment about the country’s overall economic performance; and (2) government policy. In spite of the rollercoaster ride of the years since 1992, the experiment with shares and stock markets has long since ceased being an experiment. Almost all market regulations are no longer ‘provisional’ and market infrastructure and institutions have a feeling of permanence. Equity ownership is now not only a firmly entrenched part of Chinese policy, it is, for better or for worse, the principal direction of the government’s financial and corporate reform efforts. By some measures, China’s domestic markets now rank as the second or third largest in non-Japan Asia in terms of market capitalization. By discussing market cycles, volatility, capital raised and overall market performance this chapter assembles all the pieces of this ongoing experiment with equity ownership without privatization to illustrate how they have fit together in the marketplace.
KeywordsDividend Yield Market Trend Investor Sentiment Equity Ownership Convertible Bond
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