Chinese Shares Are on Shaky Ground
- Only one-third of stocks rose during Shanghai Composite rally
- Market slid in recent weeks as sentiment on blue chips turned
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China’s stock market wasn’t in great shape even before the past month’s slide.
The rally leading into it was driven by a few dominant industry players, favored by investors concerned that smaller companies would be squeezed by higher funding costs and a slowing economy. In the 12 months through Jan. 24, when the Shanghai index peaked, only a third of onshore Chinese stocks rose. Excluding those that listed in 2017 and this year, four out of five dropped.