China Stocks Climb Despite Warning
INDEXES OF CHINESE STOCKS continued their dizzying climb upward today, despite a cautionary story in this weekend's Barron's.
In "Just How High Can China's Shares Fly?," Barron's Asian editor Leslie Norton reminded readers that the mainland China stock market has jumped 400% over the last two years. Moreover, she writes, these soaring valuations are starting to be emulated by stocks in Hong Kong, Singapore and a host of nearby markets.
"Bubbles always pop, but -- and this appears to be true in China -- it sometimes happens less quickly than some people wish, "warns Norton.
In making her case for a frothy market, she points out that the exchange-traded fund based on the FTSE/Xinhua index of Chinese shares is up 73% this year through Friday. And the Greater China Fund, a closed-end vehicle, has risen 30.8%: Franki Chung, who helps manage the fund, is "worried" bullish expectations won't be met.
But bullish expectations continue for at least this trading day. Shares of both market-traded funds were up almost a full percent today in mid-marketing trading , even though the broader U.S. stock market was down.
Also PetroChina, which had gained 50% for the year through last Friday, is up another 10% today alone. |