Reuters reports that the selloff of Chinese names extended into Wednesday, as more investors bet against China after a rash of accounting scandals of some well-known companies.
Options activity in broad China-focused exchange-traded funds and individual names showed investors are looking for more downside as shares fell again. The iShares FTSE/Xinhua China 25 Index fund (FXI.P), one of the most actively traded China-focused ETFs, is down 9 percent since April 21, losing 1.7 percent Wednesday.
Research alleging fraud at Canada-listed Sino-Forest Corp (TRE.TO) nearly two weeks ago kicked off the recent decline in Chinese issues, but the damage has spread through well-known stocks and to major indexes.
"These are massacres and I won't be surprised if these stocks continue to drop," Chris Wang, founder of hedge fund SYW Capital in New York, who has been both short and long Chinese shares. "A lot of these companies trade at a P/E of 2, one is at less than cash, and still nobody cares -- everybody wants out."
Read more at:
http://www.reuters.com/article/2011/06/16/us-markets-stocks-adrs-idUSTRE75E6BF20110616
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