Whatever the Chinese government set in the way of keeping stocks higher ran out of steam as major markets there fell as much as 8%. The run up in stocks over the last year has large been destroyed. The question now is whether the sell of will continue.
The central government has done everything from providing capital to brokerages to buy share to halting trading in some stock. However, the catastrophe was nearly unprecedented.
Chinese shares tumbled more than 8 percent on Monday amid renewed fears about the outlook for the world’s No. 2 economy, reviving the specter of a full-blown market crash that prompted unprecedented government intervention earlier this month.
Major indexes suffered their largest one-day drop since 2007, shattering a period of relative calm in China’s volatile stock markets since Beijing unleashed a barrage of support measures to arrest a slump that began in mid-June.
Analysts say the selling came as investors fear the government is curbing its buying of blue-chip stocks—and could even be testing whether the market can support itself.
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