2020-06-29 18:46:45
Will China’s stock market stand up to the opponent – pandemic?
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February and March 2020 have been marked in China's history as the largest collapse of stock since 2015. China’s financial market has been affected due to concern over the spread of pulmonary disease caused by the COVID-19. As a result of this on February 3rd, the Shanghai Composite index showed an 8 percent daily drop, according to BBC News. Two more points of daily rapid drops were recorded later on March 19th and 23rd.
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China's central bank has sent equivalent to 156 billion euros to China’s financial market in order to prevent panic and ensure further market functioning.
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There is a perception that the coronavirus outbreak has come as China’s economy was slowing after the trade war between Beijing and Washington.
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Since the March rock bottom, global risk assets enjoyed substantial growth, Asian stocks were up close to 20 percent, the S&P 500 index increased by 32 percent, oil prices and credit markets have been recovering.
A concern of the “second wave” of incidences growth has punctured optimism about soon economic recovery.
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It affected the Dow Jones Industrial Average as well, the stocks have decreased by almost 7% on Thursday, June 11th, referring to MarketWatch.
Another risk is the rising tensions between China and the U.S. According to the Pew Research Centre, 66% of American citizens see China in an unfavorable light, which is six points worse than last summer. With its presidential election in about five months, the U.S. is minded to pursue the offensive.
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That said, a range of measures adopted by the U.S. against China have had more talk than real action as there are ways to work around them.
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