China's A-share market surged at the start of September. However, the recent ups and downs in the market have both shaken investor confidence in stocks and brought up divergent opinions about the future market.
The recent fluctuations in stocks resulted from disappointing August economic data and recent tremors in the overseas markets. However, such corrections are normal for the Chinese market and healthy for stock markets in general.
There are still several good reasons for stocks to continue going up. Investors should take comfort in the central government's ongoing mini-stimulus efforts, which are intended to give the economy a boost.
Along with that broad measure, the government has also instituted policies to make it easier for small and medium-sized enterprises to list. This is a positive development for the stock market.
Although GDP growth has slowed in China, the country is trying to focus more on the quality of economic growth, not just its quantity. If successful, it will aid the healthy development of the economy.
A healthy economic structure will in turn support a stable bull market in China. There may be other corrections in the future, but in the long term, stocks will continue to climb.
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