How to avoid a potential price collapse in the stock market after China’s slowdown
China’s stock market is experiencing its largest rally in nearly three years after the Communist Party banned stocks and other assets that might threaten economic growth.
On Wednesday, the Shenzhen Stock Exchange said it would resume trading after a temporary suspension, but analysts cautioned investors that it could still fall sharply as the Chinese economy slows.
The Shenzhen market closed at 6.5 trillion yuan ($78 billion) on Tuesday, the highest level since October 2016.
Investors have been betting that the Communist government will loosen restrictions on the economy, but there are few signs of it happening.
China’s government is also under pressure from the U.S. and Europe over the collapse of its economy, which is estimated to have shrunk by an average of 8.6 percent since the start of the year.