JayAtl
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The biggest swing in China’s benchmark equity index since 2009 threatens to further erode confidence in the nation’s stock market after it lost more money for investors than any in the world during the past four years.
China’s shares were roiled yesterday by a trading error at Everbright Securities Co. (601788) that spurred a 53 percent surge in volumes and a swing of more than 6 percent in the Shanghai Composite Index. The gauge jumped from a loss of as much as 1 percent to a gain of 5.6 percent in two minutes during the morning session, then ended the day with a 0.6 percent drop. Erroneous buy orders from Everbright’s proprietary trading group sparked the early rally, the securities regulator said.
The Chinese stock index has tumbled 40 percent from its August 2009 high, erasing about $644 billion in market value, as the world’s second-largest economy slowed and local investors emptied more than 2 million equity trading accounts. Only Greece’s ASE Index has fallen more in percentage terms.
“The timing was not good for trading errors in China,” Brian Jacobsen, who helps oversee $221.2 billion as chief portfolio strategist at Wells Fargo Advantage Funds in Menomonee Falls, Wisconsin, said by phone yesterday. “There are already a lot of skeptics out there and an event like that can erode some people’s confidence.”
The Shanghai Composite has lost 8.8 percent this year, versus a 9.8 percent gain in the MSCI All-Country World Index. Chinese stock accounts containing funds have dropped to 54.4 million from 57.3 million in June 2011, according to regulatory data compiled by Bloomberg. The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. advanced 0.4 percent to 96.44 yesterday.
China Trading Error Reduces Investor Confidence in Stocks - Bloomberg
China’s shares were roiled yesterday by a trading error at Everbright Securities Co. (601788) that spurred a 53 percent surge in volumes and a swing of more than 6 percent in the Shanghai Composite Index. The gauge jumped from a loss of as much as 1 percent to a gain of 5.6 percent in two minutes during the morning session, then ended the day with a 0.6 percent drop. Erroneous buy orders from Everbright’s proprietary trading group sparked the early rally, the securities regulator said.
The Chinese stock index has tumbled 40 percent from its August 2009 high, erasing about $644 billion in market value, as the world’s second-largest economy slowed and local investors emptied more than 2 million equity trading accounts. Only Greece’s ASE Index has fallen more in percentage terms.
“The timing was not good for trading errors in China,” Brian Jacobsen, who helps oversee $221.2 billion as chief portfolio strategist at Wells Fargo Advantage Funds in Menomonee Falls, Wisconsin, said by phone yesterday. “There are already a lot of skeptics out there and an event like that can erode some people’s confidence.”
The Shanghai Composite has lost 8.8 percent this year, versus a 9.8 percent gain in the MSCI All-Country World Index. Chinese stock accounts containing funds have dropped to 54.4 million from 57.3 million in June 2011, according to regulatory data compiled by Bloomberg. The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. advanced 0.4 percent to 96.44 yesterday.
China Trading Error Reduces Investor Confidence in Stocks - Bloomberg
