Topsy turvey,(Chinese stock markets)

Article Abstract:

Chinese B shares are the only shares that foreigners are allowed to buy, while domestic investors are officially restricted to A shares. The price of B shares rose in 1993 then performed less well due to a reassessmentof emerging markets and the impact of Chinese economic policy. B shares suddenly began to revive in Nov 1996, partly because of interest from domestic investors. B shares appeared undervalued compared to A shares and there was hope the government would allow greater access to B shares for locals. This hope has weakened after government announcements of tighter regulations which have affected both A and B shares.

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Chinese puzzle

Article Abstract:

Investors in funds geared to China could be affected by an enforcement of regulations affecting ownership of B shares which overseas investors can buy but not Chinese nationals. Chinese nationals have been investing in these shares and the price has risen. If the nationals are forced to sell the price could drop. The authorities are not in favor of a major destabilization of the market, but investments in shares traded in Hong Kong or 'H' shares may be safer. Chinese markets are likely to be illiquid and volatile at least until 1998.

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Hong Kong/China: after Deng

Article Abstract:

The death of Deng Xiaoping, leader of China, has not damaged share prices over the short term, but the long-term impact cannot yet be assessed. NatWest Markets sees the strength of the Chinese economy as likely to benefit share prices and help strengthen the position of Jiang Zemin as leader, while economic reforms are unlikely to be reversed. Morgan Stanley sees a possible power struggle and is generally optimistic but argues that investors should assess signs of major changes in areas such as international and economic policy.

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