China's stocks rebounded yesterday after falling by as much as 4 percent. Evidence of slowing growth in China's economy also brought uncertainty to global markets.
According to Telegraph, after plunging 4.39 percent, Shanghai's stocks came back to close it by a 0.2 percent down. Analysts are saying that the Chinese government most likely provided the support ahead of a two-day World War II remembrance holiday.
Official data showed on Tuesday that Chinese factory activity contracted in August — accounting for more than 13 percent of the global GDP — is slowing down.
Analysts and investors are acknowledging that it is similar to gambling.
As reported by BBC, in celebration of the end of World War II, Chinese markets will be closed on Thursday and Friday.
Shanghai-based fund manager at JK Life Insurance, Wu Kan, told the AFP that Beijing appeared to have been buying shares over recent days as an effort to support the market.
But Wu Kan said "Investors have lost confidence... the correction isn't over yet."
Since June of this year, despite attempts by the government and regulators to restore the market, Chinese shares have lost nearly 40 percent of their value.
Ronald Wan, chief executive for investment banking at Partners Capital International, told CNBC Asia's "Squawk Box" that, "Investors are still on an exit mode... they do not want to hold shares before a long weekend." He further added, "But at the same time, the 'national team' is buying in to support the index above the 3,000 level because they need a stable environment during the long weekend."
Considering other indexes of China, blue-chip CSI300 was up 0.11 percent, while smaller Shenzhen Composite closed down 2 percent.
Despite the roller-coaster ride of China's market value, the International Monetary Fund has said that the Asian economy is doing "pretty well," as reported by Bangkok Post.
Stay tuned more business news and updates.
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