Stocks News
- Investors stiffen resolve as market falls
Date: 1-Jun-2007 Sources: (Shenzhen Daily)
THE country's swelling ranks of stock market investors - from housewives to students - took the market's second-biggest plunge this decade in their stride Wednesday, with many vowing not to pull out despite the fall.
Individual investors, who have fueled China's equities bull run, continued to open brokerage accounts in Shanghai despite a 6.5 percent fall by the Shanghai Composite Index on Wednesday.
The market fell after the Ministry of Finance tripled the stock trading tax in an effort to cool rampant speculation that had pushed the index up 62 percent this year.
But in the public trading halls of Shanghai brokerages, the mood was generally calm, suggesting individual investors, who account for up to 80 percent of turnover, were unlikely to stage a mass exodus that could trigger a bear market.
'I realize the risks clearly,'said Xiao Liu, a 29-year-old medical equipment saleswoman, as she queued with 10 other people to open an account at a Shanghai Securities branch in the city's financial district.
Liu said the lesson of Wednesday's plunge was that she should invest in blue chips to hold them for months or even years, instead of trading small, speculative stocks.
But even as the index tumbled, Liu said she would enter the market by investing 20,000 to 30,000 yuan (US$2,620 to US$3,925), half a year's salary for many Chinese.
'After all, investing in stocks is still the wise choice,'Liu said.
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