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What Affects the Stock Market of China?

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What Affects the Stock Market of China? Introduction: In 1990, two Stock Exchanges were built in Shanghai and Shenzhen, after which the stock market of China developed very quickly. The number of companies entering into the stock market increased from 8 in 1990 to over 1000 in 2002. And the number of investors also increased magically from 6 million in 1996 to 50 million in 2002. In addition, the Shanghai Composite Index rush to 2245 points today compared with 100 points at the beginning. Obviously, the Chinese stock market is younger than those of western countries, but it really developed very quickly. Moreover, China is now carrying out "socialism market economy", which help to perfect the system of its stock marketing. In many people's opinions, the economy of China is not running according to the economics disciplines, and it is controlled by the central government instead. As the result of this, the stock market is controlled by the central government too. So, this search report attempts to point out what in deed affects the stock market of China. ...read more.


Findings/Results: According to the data and charts searched, the stock market of China has been viewed a quick development. In 1990, the stock index was 100 points; in 2001 the stock index was 2245 points, which raised 2245 per cent. During year 1990 and 2002, some sudden events happened in China, for example Mr. Deng Xiaoping, the leader of China, died, HONG KONG came back to China, Asian financial crisis, Chinese embassy in Yugoslavia was attacked, China was accepted to join in WTO, and China succeeded on its application to hold Olympic Game in 2008. All of these sudden events did make the stock market shake temporarily. According the data of Chinese economy, from 1990 to 2000, GDP grew strongly. Refer to chart II, it shows that Chinese economy grew steadily in the lasted ten years. It continued to grow at a rate around 7%, which was higher than that of most other countries. The chart of USA and UK stock exchange shows that the Dow John Industry index and FTSE 100 Index all dived about 40 per cent from 2000 to 2003. ...read more.


But are these findings true, impersonal and all-sided? Actually, this search report always attempted to choose relevant and useful data. First, various dada were addressed. Some reference books were about how to buy stock, some were about European stock markets, and some published about ten years ago. After reading the abstract, four reference books were chosen which were thought more relevant and useful than others. They provide information about relationship between Chinese stock market and Chinese economy. Some data and charts were collected from Internet; which were also very from each other. It is important to make the data true and authoritative. For this reason, some little or private websites were not chosen, and most data come from the big, famous, and governmental websites such as yahoo.com, FT.com and Stockstar.com. On the other hand, there are about ten different stock indexes in Chinese stock market, why the Shanghai composite index was chosen? There are lots of different indexes of Chinese economy, why GDP was chosen? The western stock markets were not only USA and UK, why they were chosen? It is clear that they are all very typical and famous so that help to demonstrate things more clearly and trustfully. ...read more.

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