Read on to know if the fall in Chinese market is good for India?

Read on to know if the fall in Chinese market is good for India? Can the fall in Chinese market be a good news for our Dalal Street? Not really it seems. According to market experts, a fair comparison cannot be done as not much data is available.

As per an ET report, the Chinese market recorded its steepest weekly fall since 2008 on Friday. The index plunged over 13% in the last five trading sessions. Interestingly, the Indian equity markets rallied over 3% per cent in the same period.

A fall in China is not necessarily good news for India, , in an interview with ET Now. “Again the correlation seems a bit far-fetched. Investors are going into India because it is a long-term growth story, and to China because of the momentum trade,” said Hans Goetti, BIL in an interview with ET Now.

He explained, “I think margin debt will have to come down meaningfully in China and we have to see how it plays out.” It should be noted that the Shanghai Composite Index ended the day 6.42% or 306.99 points, lower to 4,478.36 on Friday. The BSE Sensex closed 200.34 points higher at 27,316.17. It rose over 3% for the week ended June 19.

Analysts believe that it would be unfair to compare the two market simply because the equity markets of both the countries are totally different in terms of the structure of the economy, role of the government and relative importance of various sectors. On the other hand, India is more of a long-term growth story.


According to a Reuters report, the correction in Chinese markets was triggered by regulators' fresh moves to tighten margin financing.