Shanghai struggles despite bailout (updated)

Monday, 6 July 2015

Shanghai opened a nice 5% higher this morning following the weekend’s kitchen sink bailout but had faded now to 2.5%:

Worryingly, the high beta Chinext market has rolled and is now down 2%:

I’ll be honest, I have no idea where this bubble will go next. If you put a gun to my head I’d say down further but there’ll big bear market rallies for sure. When it does capitulate it’s still hard not to see it as a buy given authorities sudden love for equities.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.