Special Report: Global Financial Crisis
BEIJING, Jan. 1 (Xinhua) -- Chinese equities ended
2008 by falling for the last eight consecutive trading sessions.
The benchmark Shanghai index closed down on Wednesday
to end at 1,820.81 points. On the last trading day of 2007, the index closed at
5,261.56 points. That's a difference of 65 percent.
After opening in 2008 at 5,265, it took only 10
months for the index to hit a low of 1,664 points. The market hit an all time
high of 6,124 in October 2007 and dropped more than 70 percent within a year.
Market value of shares in Shanghai and Shenzhen stood
at 33.5 trillion yuan (4.9 trillion U.S. dollars) after the first trading week
of 2008. The figure reduced to 12.1 trillion yuan on the last trading day of
2008. That's a loss of more than 20 trillion yuan, or about 3 trillion U.S.
The average loss for each of the 104.24 million
accounts of both bourses was more than 200,000 yuan.
That amount is equivalent to 10 years of disposable
income for an average Chinese urban resident.
"I really regret not withdrawing my money when I had
400,000 yuan in surplus on my account. Now I ended up with a 700,000 yuan loss,"
said Li Yu. The Beijinger opened his account for stock trading with 1 million
yuan more than a year ago.
"It was a nightmare seeing my dreams of buying a
larger apartment and a Passat gradually vanish," he said.
Analysts said the poor performance of the markets was
partly a result of heavy losses on Wall Street during the global financial
Weak markets also reflected a slowing domestic
economy following disasters and weakened external demands for Chinese exports,
"Unfavorable economic data that indicated a slowdown
in the economy have played down investor's anticipation of corporate profits of
listed companies," said Qiu Yanying, a Shanghai-based Tianxiang Investment
He said falling share prices actually reflected
pessimism of investors.
The country's major portal website, Sina.com, on
Thursday listed articles from 30 stock analysts predicting what will happen in
the new year. Most of them expressed optimism, especially for the second half of
Teng Tai, chief analyst of the China Galaxy
Securities, said in his article that hope and opportunities would go along with
challenges and difficulties next year. He added that investors maybe able to
embrace better investment opportunities in the second half.
Cheng Wenwei, chief analyst of the Hongyuan
Securities, said the market performance would become stable in 2009 after the
build-up of bubbles in 2007 and the burst of bubbles in 2008.
However, most of them warned of gloomy prospects in
the first half of the year as uncertainties about the world's economy remained.
Government policies to boost the economy, also would take time to produce
Individual investors, on the other hand, were
unwilling to materialize their losses by selling shares. Many chose to wait for
Li said he would follow the advice of veteran
investors and hold on until share prices rebounded for him.