The rout in Chinese stocks is going global.
U.S.-traded Chinese equities extended their plunge to 21 percent from this year’s high as of 10:34 a.m. in New York, approaching a bear market. Alibaba Group Holding Ltd. tumbled to the lowest since its initial public offering, while JD.com Inc. sank a record 9.4 percent.
The stocks plunged after the Shanghai Composite Index sank for the fourth time in five days as measures to stabilize the market failed to stop a rout that’s erased more than $3.2 trillion of value in less than a month. They have included a pledge by state-run financial firms to buy $19 billion worth of shares and a halt to initial public offerings.
“Investors are fleeing anything associated with China, they don’t want to have anything related to China in their portfolio,” Brendan Ahern, chief investment officer at Krane Fund Advisors LLC in New York, said by phone on Tuesday. “Investors are reading the risks around China, and there is a spillover effect in the U.S.-listed stocks.”
The Bloomberg US-China Equity Index fell 8.4 percent to 111.14, the steepest drop in four years. The Deutsche X-trackers Harvest CSI 300 China A-Shares ETF, the largest exchange-traded fund tracking mainland shares in the U.S., fell 9.2 percent to $37.53, the lowest since March. Normally ETFs are a relatively safe way to invest money but it is important to know details about this type of investment, such as how do I create an ETF portfolio (wie erstelle ich ein ETF Portfolio), for example, so that it can be managed properly. Other companies are also finding the current market challenging as Alibaba plunged 4.9 percent to $76.32. JD.com declined to $28.90.
It was all funny money to start with, created by hot air inflating an unsustainable stock bubble. He should have sold his company while the getting was good and stashed the loot in gold, Treasuries, and U.S. stocks and real estate, then retired to the Cayman Islands to live a life of ease.