Impact of China on Global Markets

Chinese market have stumbles an overwhelming points over the last one year. We in India and globally investors are quite worried seeking the virtues and impact of the Chinese collapse on Indian and global markets as a whole. The worry can be seen in pessimist reviews by economists all over the world, but are Indian markets are at risk. 
The answer is NO and the consensus is based on the theory of how the economics in China are moving. They have invested huge sum of money in infrastructure projects and that too a lot of them are in their rural back drops. So they are awaiting money to be pinched in now in the economy once the projects start reaping in profits. Also, China has some minimalist debt from international bodies with huge foreign reserve lying in their disposition an year back. With the markets eroded completely they are now likely to hamper their foreign reserve outflow from four trillion dollar to 2.6 million dollars in times to come. 
The present quarter is likely to maintain some positive inclines in the global markets with the oil crisis likely to recover Chinese economy could see hard signs in the third quarter in times to come. I really think as an investor and equity analyst that their would be a huge impact globally but for India we are likely to remain aloof with some corrections. Also if you basically talk about the Chinese stock markets as such all stocks are quoted at ten times their actual valuation figures that holds a strong correction for shares trading at their all time highs right now. The economics are running weak with People Bank of China as their central bank tending to de-value the currency to pitch in for exports and cashing up on with the dollar. 
The remnibi or Chinese Yuan was last year added by the IMF in a group of currencies and that might have added as a plus point for the economy but rather than making use of the power that would have bestowed in the economy the China is far fetched to de-value its set state. Loosing its charm of an ever increasing rise of 10% year on year and now surpassing levels at a declining trend of 5-7% economists are debating as to how the markets would move herein. Industry experts are of the view that after an initial development is made in an economy stagnancy creeps in and one need to fight that with a lot of reforms from the government and that might be the reason that they are not seeing for the short term and are investing in the rural areas with a long term view. So we can be safe in a lot of respects with investing being likely to surpass levels as this is a good time to invest in stocks valued much lower than their actual levels. 
This blog post is inspired by the blogging marathon hosted on IndiBlogger for the launch of the #Fantastico Zica from Tata Motors. You can apply for a test drive of the hatchback Zica today.

No comments :

Post a Comment

This post is incomplete without your comment. I Would Love to Hear what You Think ! ✿


Related Posts Plugin for WordPress, Blogger...