July 05, 2015

"According to Oxford Economics, shares may have to fall another 35% or so to bring them into line with long-term averages."

CNN China stocks have pulled out of their tailspin after Beijing took a series of dramatic steps over the weekend to prevent an all-out market crash. By Charles Riley

'After opening with gains of roughly 7%, the benchmark Shanghai Composite was trading 4% higher on Monday, while the smaller Shenzhen Composite was up 2%.

'The stabilizing measures include a commitment from brokerages to buy billions worth of stocks, and a de-facto suspension of new IPOs. In addition, the central bank has offered a new line of credit to support margin financing, a risky way to invest using borrowed money.

'The Shanghai Composite -- the world's third largest stock exchange if you add up the value of its companies -- has lost roughly 25% since June 12, putting it officially in bear market territory. The bears are growling even louder on the smaller Shenzhen Composite, down 31% in the same period. The drops are in sharp contrast to massive gains markets made earlier this year.'

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