The Chinese share market is continuing its skyward rise despite another blip at the beginning of the month wiping billions of dollars off its key indice – the Shanghai Composite Index.
Since that 8.26% drop last Monday, the market has crept back up from a low of 3,670 towards the psychological 4,000 point mark, to close at 3,995 yesterday.
Yesterday’s close leaves the market short of its all-time high of 4,288 reached in the preceding week but this is still a staggering feat for any market considering it only reached the 3,000 point mark a little over 10 weeks ago in late March.
The market had flirted with the 3,000 mark in late February, however the panic over potential Government moves to cool the market resulted in a significant sell off that sent shock waves around the world.
Irrespective of benchmarks, one thing is for sure in China – investors need to be made of stern stuff to stomach the daily volatility of its share markets.
For a casual observer, the market movement at present suggests one of two things – extreme nervousness among investors or increasing numbers of punters and money managers treating the share market as one big casino.
Shares in the Shanghai Composite Index (the primary benchmark for shares in China) may have retreated from their all time highs of late May, but it’s the daily volatility of the market that’s most interesting.