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China's Stock Markets Experience Biggest Fall in 10 Years

Wednesday, February 28, 2007 01:50 AM

by Daniel Schearf

China's Shanghai Composite Index fell Tuesday by 8.8 percent, while the smaller Shenzhen Composite Index sank by 8.5 percent.

The selloff, the biggest one-day fall in a decade, came as investors dumped shares for quick profit from Monday's record high, when the Shanghai index surpassed 3,000 points for the first time closing at 3,040.

The Shanghai index closed Tuesday at 2,771 points, down 269 points.

Tony Tong is an analyst at Everbright Research in Hong Kong. He says higher interest rates may also have encouraged investors to take money out of China's unpredictable stock markets and put it into safer investments in state-run banks.

"The market is thinking that there may be another hike in the reserve ratio and even interest rates. So the credit-tightening issue would be a major concern," he said. " I would say in the coming few weeks the market will remain under pressure."

China's economy and the stock markets have boomed over the past few years, prompting fears that excess investment could lead to problems such as inflation or excess industrial and property capacity. Those problems could trigger a market collapse or a recession.

The government, hoping to gently cool down the economy, in the past year has repeatedly raised interest rates and restricted bank loans.

However, those measures appear to have had little deterrent effect on investors. China's stock markets doubled in value last year, leading to concerns of a market bubble that could collapse.

Stock markets around Asia Tuesday were down as well, with many investors concerned about a possible slowdown in the U.S. economy. Most indexes fell one to three percent.

Indexes in South Korea, Australia and Singapore dropped from record highs. Hong Kong's Hang Seng Index of blue chip stocks fell 1.8 percent to a four-week low, partly in reaction to the mainland drop in stock value.

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今日词汇

英语学习的过程，很大一部分是词汇积累的过程。词汇掌握多了，无论应对书写，都能信手拈来。美国的英语教师利达·贝克为那些想提高英语水平的人提出了五点建议。其中有一条就是每天学一个新单词。

金莺英语提供的金融词汇往往还不是一个单词，通常是一个词组，表达的不光是一个金融含意，多半都包含了许多基本的金融专业知识或者行规。

今 日 词 汇 2007年02月28日 注：[保]代表保险，[房]代表房地产，[会]代表会计，[分]代表注册财 务分析师，[银]代表银行，[证]代表证券 　 zero-balance account      [银]       零结存账户 A checking account in which 1）zero balance is maintained  2） by transfers of funds from a master account    3）in an amount only large enough to cover checks presented. 一种支票账户，藉 由2） 自一个 主要账户中转入 只 3）足够支付开出支票的资金，1）并维持 零结余     的支票账户。     什么是 zero-beta portfolio？明天说明。