China shares: fears mounting of another crackdown slump – "We've seen this picture before"

<p> Dow Jones / Market Watch convey comments from a US analyst on Chinese stock markets (Clocktower's chief strategist Marko Papic</p><ul><li>concern is that the Chinese government will be "heavy-handed" in carrying out "significant regulatory activity" just as China is "in the middle of private-sector deleveraging," </li><li>"We've seen this picture before," (referring to the crackdown on technology companies in 2021)</li><li>regulatory action targeting the financial sector may hurt lending by banks</li><li>"Everybody is looking for a reason to buy Chinese stocks because they're cheap," said Papic. But the "constant throwing of regulatory sand in the gears," he said, "makes it very difficult for us to tell our clients that there's any fundamental reason to be bullish"</li></ul><p>—</p><p>I noted yesterday that the Shanghai Composite had bounced a little, with plenty of chatter about 'National Team' (China's state-backed funds) bids. </p><p>We were given the heads up to something like this earlier in the week:</p><ul><li><a href="https://www.forexlive.com/news/chinas-sovereign-wealth-fund-says-it-will-help-with-market-stabilization-in-2024-20240116/" target="_blank" data-article-link="true">China's sovereign wealth fund says it will help with market stabilization in 2024</a></li></ul><p>That bounce continued into the close:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.