By Lavender

It was a black Tuesday for China’s stock market on 27th February 2007. The A-Share Market collapsed and clutched at straws to back the share prices. But the market was lighted up by a favorable policy that the news spread among main fund managers and Private Placement Traders. The A-Share markets rebounded after one-day slump and the Index surged more than 100 points.

The performance in yesterday morning session attempted to climb for several times after the dramatic fall, but it failed to find a good opportunity. It was only a stabilizer for no more plunge when The State Administration of Taxation declared that no Stock Transfer Income Tax could be ruled out recently.

But afterwards, it seemed that the market had strong recovery and skyrocketed in the afternoon. One of Private Placement Managers in Beijing confirmed at 2pm on Wed.” we get the message from MSN, and it circulates in the circles, we intended to close the short-term trading but now we’ll leave making decision on it until Thursday.

it is proved that the powerful news came from yesterday issued Peple’s Daily which laid the small item out on the right corner of the forth page . Actually, it was the forecast to latest Qiushi Journal that would be published on 1st Mar. What the securities institutions expected mostly was only 24-chinese character the title of premier Wen’s article: Push Forward the Financial Reforms and Promote the Financial Industry Development healthily and Constantly

Obviously, both Qiushi Journal crucial position and the strong expectation sparked the investor’s enthusiasm. Many market practitioner much believed that Premier Wen’s article indicate the protection to financial market from top administration and lead the way after the dreadful decline on the basis of the healthy and constant development to the financial market.The A-Share Market confidence rallied with the impact of the good news and the Shanghai Composite Index close at 2881.07, up 109 points or 3.94 percent.

The data was generated by China Securities Depository and Clearing Corporation also supported the speculation that the market was as red-hot as before. The new A-Share account and fund openings grew persistently, the two increased by 20,000 up to 130,999 and 38,000 to 56,668 respectively on the slumped Tuesday, more openings than Monday when the Index hit 3000 points.

However, the yesterday openings did not come out yet, the securities companies provided the information that new investors still needed to queue for account openings, and they did not feel full negative about the market after a huge drop, while the long-term investors were positive about the security market and strong economy in China.

Copyright Fund China 2009.

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