Market review:
China stock market continued to decline despite the overnight strength in Europe and US market and rebound of Nikkei and closed at 2735.56.
Research Notes:
1.Though the pessimistic econ outlook and outflow of capital are nothing new to investors, China gov so far had not made very convincing moves to counter the bears.The limit of RMB lending in some commercial banks in HK is one more step to capital control and it may push the investors to liquidate their asset before the more limits set in.
2.Money outflowed from Electronics, Machinery and Real Estate sectors the most, and flowed in Coal Mining and Entertainment sectors. Perfect World Pictures Co, a movie producer, rallied to limit up.
Though SHA looks more attractive around 2700 and state funds could buy in to boost the sentiment, we maintain our recommendation to stay put until Fed decision come out.
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