Fortune China’s stock market is up by 25%, but it has been a rocky road, and lately it’s been all down hill. by Stacy Jones and Stephen Gandel
'China’s stock market is up 25% this year. But it has been anything
but a smooth ride. Shares of Chinese stocks rocketed up for most of the
first half of the year, increasing by nearly 50% in the first
five-and-a-half months of the year.
'From that point, though, the market has mostly gone straight down.
Stocks have been dipped by nearly 25% over the past two weeks or so. And
the plunge is picking up steam. China’s Shanghai Composite index has
dropped by roughly 11% in the last two trading days. That’s the
equivalent of a nearly 2,000 point plunge in the Dow.
'Where do we go from here? Some have predicted the drop in Chinese
stocks for a while. China’s economy has been slowing, and corporate
profits have been falling. So the fact that Chinese stocks were rising
as much as they were was a bit of a mystery from the beginning of the
current run. China’s central bank has been pumping money into its
economy, partly to boost its stock market and help its economy more