Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: Mr Apple

“Do you see this affecting DJIA over the next months”

It depends on how things turn out. Big downturns on Chinese stock markets generally drag the other stock markets around the world down with them that day, but they move much more independently over longer timeframes (weeks and months).

Most of the money on Chinese stock markets is unlikely to flee to US stock markets - it is a lot of state-owned companies and small Chinese investors who lack access to foreign markets.

If the Chinese economy really tanks, rather than just their stock markets and/or currency, then that will be a real drag on the global economy - a negative for US stock markets, but objectively not a killer. Some Chinese downturn is already priced into the US market prices. Sentiment could of course overreact to a sudden Chinese downturn, dragging US markets down more than justified in the short term.

So I would guess that China is more likely to be a negative rather than a positive for US markets, and more likely to be a small effect than a large one.


37 posted on 02/05/2016 8:29:02 AM PST by BeauBo
[ Post Reply | Private Reply | To 24 | View Replies ]


To: BeauBo
Thank you very much for your astute reply. Excellent information.
38 posted on 02/05/2016 8:34:46 AM PST by Mr Apple (I believer fellow freepers, that it's time to invest in silver coins now..........)
[ Post Reply | Private Reply | To 37 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson