New | Pessimism persists among Chinese investors despite government measures to rescue market
Chinese investors remained pessimistic on Monday as stock markets closed lower than expected despite a series of emergency meetings and further government attempts to correct the volatility over the weekend.
"It looks like the government has put great effort into trying to rescue the market, but little has improved," said Rebecca Liu, 38, a company director in Beijing.
"If even the government has failed to [rescue the market], how can we, retail investors, [tell] the market direction? Before today, I would have considered buying property. But now that possibility has been completely ruled out."
Liu said she had invested several million yuan in the stock market since early this year and that now most of her money was tied up there.
The benchmark Shanghai Composite Index surged 7.8 per cent after the market opened but ended the day up only 2.4 per cent, at 3,775.91 points.
"I don't know if a financial crisis is coming. It's really bad now. Not just the stock market, but the real economy too," Liu said.
The National Bureau of Statistics said the Chinese economy was showing positive signs as new government measures gained traction, but that the country could not lower its defences against the slowdown.
"The improvement in main indicators is still initial and we cannot lower our guard against the downward pressure on the economy," bureau spokesman Sheng Laiyun said.
"Arduous efforts are still needed to consolidate the foundation of economic stabilisation and ensure the achievement of the full-year growth target."
A Beijing resident surnamed Gao expressed his concern over the stock market volatility.
"Now I don't expect to earn any money in the stock market any more. It is a suffering to be tied up in the stock market," Gao said. "Once I have my capital back, I will move out of stocks."
Gao, who has other investments in different businesses, agreed that China's poor real economy had contributed to his pessimistic outlook. But the market slump would not affect his spending plans, he said.
China rolled out an unprecedented series of steps over the weekend to prevent a full-blown stock market crash.
The measures - which included a commitment from the central bank, the People's Bank of China, to provide liquidity for state-backed margin lender China Securities Finance Corporation - won some investors' confidence, including that of Beijing pensioner Song Zhengyong.
The 80-year-old applauded the government's "timely measures … to stabilise the market".
Song believes the government's support will help boost the market eventually. "It won't recover very quickly, but gradually it will become better," he said.
He increased his investments in financial stocks on Monday, including those of banks, securities and brokerage firms, which he said were "closely relevant to the government's efforts to stabilise the financial market".
Liu Yifeng, 41, a company manager in Beijing, said he would stay in the stock market. "If everyone moves out, it would be harder for the government to rescue the market," he said.
