China Stock Market

Recently, there has been a lot of talk regarding China’s stock market and economy. China’s economy has been in a steady period of growth for years and now things are changing, which has caused people to be in a uproar. During the first week of trading in 2016, China’s stock market plummeted. It caused many concerns for people around the world. It made people think, what is going on? Is China going into a Recession? One of the reasons for this issue is that China installed market-wide circuit breakers into their stock markets. Circuit breakers are used to put a halt on trading when prices taking a significant drop. Once this occurs the whole training day closes. The circuit breakers have not been beneficial to the Chinese stock market so far in 2016.

Many people are concerned about China going into a recession. It is definitely normal for one to think this because of all that is going on right now. However, the answer is still unknown but the GDP growth rate is still not concerning yet. In 2015, the GDP growth rate was around 7% and it is looking to be 6-7% in 2016. However, some economists feel it will be about 3% in 2016, but this not mean they will be in recession discussion.

There are also  some people who believe that some of the growth figures are lower than what the government is saying, which has led a spark for concern.  Another important issue is that on Tuesday Monthly Industrial Production and Retail sales for China were released and with December numbers in coming worse than most people anticipated.

According to Kenneth Kim, a contributor who writes about markets and economy, believes that the United States does not heavily depend on China’s economy. He believes that the amount of sales that  U.S has in China represent a small size our GDP, which is an interesting assessment.  Only time will tell on the outcome on China’s economic dilemma.