Global Obsession With Chinese Stocks Makes No Sense to Aberdeen
- China's stock market seen as more casino than gauge of economy
- Shanghai Composite's correlation with S&P futures hits record
Employees work on the trading floor of the Shanghai Stock Exchange in Shanghai, China.
Photographer: Kevin Lee/BloombergFrom 9:30 a.m. to 3 p.m. China time on Wednesday, the three price charts were almost indistinguishable -- U.S. stock in Chicago, in London and the in Japan. They were all guided by the same mercurial force: the Shanghai Composite Index.
The benchmark gauge for Chinese stocks, long out of step with the rest of the world, has suddenly turned into a leading indicator for global markets as traders grasp for something -- anything -- to help them gauge what’s in store for the world’s second-largest economy. The problem, according to some of Asia’s most experienced money managers, is that Chinese stock prices offer few insights into the country’s economic health.