With President Obama scheduled to make his first presidential trip to Beijing this weekend, China Region Fund (USCOX) co-manager Romeo Dator appeared on CNBCrsquo;s ldquo;Power Lunchrdquo; today to discuss the U.S.-China relationship. The other guest in the segment was former U.S. Secretary of Commerce Carlos Gutierrez, who stressed that the U.S. relationship isnrsquo;t the only one thatrsquo;s important to China. [Obama] wonrsquo;t be able to give them a public lecture. Hersquo;s going to find a more assertive, a more confident China. The only thing playing in our favor this time is that the whole of Asia is up in arms about the dollar. Since the Chinese peg their currency to the dollar, itrsquo;s giving them a benefit versus the rest of Asia. The only real chance we have here is for Asia to convince China (to let the yuan appreciate). Romeo predicted that Asia on the whole will grow in importance for investors. I think ...

Renewed fears that the global economic recovery is faltering shook investors across Asia, sending stock markets in the region sharply lower Thursday.  The Nikkei fell below the 10,000 mark for the first time in three weeks.  Dollar and yen rose as hedge funds sold off risky positions and traders trimmed their appetite for risk. 

The Nikkei 225 stock average fell 1.8% to 9,891.10 and Hong Kong’s Hang Seng index plunged 2.3% to 21,264.99 points. In Mainland China, the Shanghai Composite Index dropped 2.3% to close at 2,960.47.  All other major indices in the region ended in the red.   

On Wednesday, US stocks tumbled after a weaker-than-anticipated new home sales report aggravated concerns that the seven-month old rally has gone ahead of any economic recovery.  To add to the bearish sentiment Goldman Sachs lowered its projection for the third-quarter gross domestic product.  The government's report on third-quarter GDP is due

...

U.S. stocks rose for a fifth day on Thursday as a larger than expected drop in U.S. jobless claims and an upbeat forecast from consumer goods maker Procter & Gamble added to enthusiasm that the economy is on track for a rebound.  Energy shares advanced, helped by rising forecasts for oil demand.  Nevertheless, given September’s weak track record, market participants have been bracing for a pullback.

On Thursday, the Dow Jones industrial average rose 80.26 points, or 0.8%, to 9,627.48, its highest close since October 6.  The broader S&P 500 index advanced 10.77 points, or 1%, to 1,044.14, its first five-day climb since November.  The Nasdaq composite index rose 23.63 points, or 1.2%, to 2,084.02.  With traders eschewing safe havens, yield on the benchmark 10-year Treasury note fell to 3.35%. The yield on the 30-year notes declined to 4.20%.

As the holiday-shortened week comes to an end today, investors

...

China walks the walk… red nation agrees to major shift away from dollar reserves… Gold soars… Frank Holmes with a historic reason gold should keep rising… You know Peak Oil, but Peak Stimulus? Chris Mayer offers a compelling chart on government intervention… Dark data: Service sector, retail, jobs all disappoint, plus a shocking stat on student debt…

Walking the long, windy road toward the demise of the dollar, we spy another mile marker today: China is officially putting their money where their mouth is.

After clamoring for a reserve alternative all year, the Chinese government agreed to a $50 billion currency-diverse deal with the IMF today. Back in June, the deal seemed imminent. This morning, it finally came to fruition.

In their deal with the IMF — the first of its kind for any nation, ever — China buys $50 billion worth of bonds denominated in Special Drawing Rights, which

...

Lingering economic uncertainties kept stocks under pressure for the fourth straight day on Wednesday even as minutes from the Federal Reserve’s last policy meeting showed the economy is slowly turning a corner and inflation is likely to remain restrained.  Trading was mostly rangebound as investors chose to remain on the sidelines.  As investors went into risk-aversion mode, Treasuries jumped and corresponding yields declined, with the yield on the 10-year tanking to its lowest in more than seven weeks.  

Trading may remain subdued as the Labor Day weekend approaches.  Nevertheless, today’s trading could benefit from last afternoon’s optimistic FOMC minutes coupled with improved growth expectations from the Organization for Economic Cooperation and Development and Chairman of China’s Securities Regulatory Commission advising regulators will promote stable markets.  China’s Shanghai Composite Index jumped 4.8% in an otherwise normal day for Asian bourses.  This morning’s stock futures are pointing to a higher opening

...

The Top 10 Reasons Why the China Sell Off Will Continue

by Louis Basenese, Advisory Panelist

How much are you willing to pay for good advice? And by “good,” I mean profitable.

A couple of hundred bucks? A couple of thousand?

Before you answer, consider this: Two weeks ago, I alerted members of The Oxford Club to the precarious position of Chinese equities. As I put it, “China could be on a crash course with a correction.”

A contrarian stance, no doubt. But vindication came quickly.

The following Monday, Chinese stocks (represented by the Shanghai Composite Index) suffered a 5.8% drop – the worst single-day decline of the year. Two days later, they got dented by another 4.3%.

Unabashed China bulls will point out that the Shanghai index promptly recovered. But then this week hit…

Rally Rebuffed: Chinese Stocks Take Another Tumble

On Monday, the

...

U.S. stocks closed lower Monday after a sharp decline in China’s main stock index reignited worries that the six-month old rally defies logic and is built mostly on hype.  Yesterday’s 6.7% plunge in Shanghai Composite Index on concerns over tightening credit in that country sent stocks in Asia sharply lower and led to further selling in Europe.  Treasuries rose as investors shunned equities and turned towards safer bets.  Oil prices declined below $70 per barrel for the first time in almost a week on concerns about China’s growth prospects. 

The 30-stock Dow Jones industrial average shed 47.92 points, or 0.50%, to close at 9,496.28.  The broad Standard & Poor's 500-stock index was down 8.31 points, or 0.81%, at 1,020.62.  The tech-heavy Nasdaq composite index lost 19.71 points, or 0.97%, to 2,009.06.  Nevertheless, the Dow managed to end August up 3.5% for its fifth monthly gain in six months while

...

The performance of a number of global stock markets is given in the table below in local currency terms for different measurement terms ended August 31. The numbers speak for themselves, but it is noteworthy that the MSCI World Index (+3.9%) and MSCI Emerging Markets Index (-0.2%) followed separate paths in August as China, Hong Kong and India underperformed.

Click here or on the table below for a larger image.

Top performers during August included Austria (+11.3%), Ireland (+10.9%) and Venezuela (+10.6%). At the bottom end of the performance rankings countries included China (-21.8%), Hong Kong (-4.1%) and India (0%).

The key moving-average levels are also given in the table above. With the exception of the Chinese Shanghai Composite Index, which fell below its 50-day moving average about two weeks ago,

...

China has once again set the tone for our Monday market forecast.

Roll the videotape:

Chinese traders dumped shares early this morning after a popular magazine rumored that the booming Chinese loan market is cooling off. Caijing magazine guessed that the Chinese loaned about $29 billion in August, a 43% crash from July. While that number isn’t official, traders around the red nation raced for the exits. The Shanghai Composite closed down 6.7%, its worst day in over a year. 16% of the stocks on the Shanghai Composite fell 10%, the daily limit down.

Thus, as we charted above, Chinese stocks are in a textbook bear market. In fact, down 23% since its 2009 peak earlier this month, the Shanghai Composite will be the worst performing major national index in the world for the month of August.

But still up around 50% for the

...

U.S. stocks fell on Monday as concerns about the global economy’s health weighed on Wall Street, following a hefty sell-off in Chinese equities.

Energy shares led the decline after the sharp drop in China’s main stock index increased worries about a potential rebound in global energy demand and oil slipped below $70 a barrel.

Shares of Chevron Corp tumbled 1.2 percent to $69.81 and Exxon Mobil dropped 0.8 percent to $69.56. The S&P Energy index <.GSPE> was down 1.8 percent.

The Shanghai Composite index <.SSEC> fell nearly 7 percent to a three-month low on fears that China’s government is trying to moderate economic growth and choke off some speculation in its stock market by tightening bank lending.

“China’s decline is just scaring people,” said Tim Ghriskey, chief investment officer at Solaris Asset Management in Bedford Hills, New York.

“The world is partially relying on China’s economic growth to bring us out of this recession, and given the

...