China’s A-Share Market Is Still Unpredictable

It seems that as soon as China’s regulators succeed in bringing some stability to one asset class, a bubble immediately begins to brew in another class of assets as investors quickly shift their cash to the hot asset of the moment in an attempt to achieve the best returns. Indeed, according to a report from HSBC out today, there are debates that property curbs imposed during China’s National Holiday may bring liquidity inflows to the A-Share market. There is some evidence that this trend is already developing. A-share investors’ securities transaction settlement funds (STSF) reported a strong net inflow of RMB99.4 billion on 10 October 2016, a record high since March 2012. Although, the flow then turned to negative RMB5.8...