China’s share market volatility

Key points

Just as the rise in Chinese shares had little economic impact it’s hard to see the pullback having a significant economic impact either. > Chinese economic growth is likely to remain “around 7%” with monetary and fiscal easing helping. > The volatility in Chinese shares represents a necessary correction. Large cap shares are not expensive. > The main dampener on commodity prices – and Australia’s terms of trade - is not China, but supply.

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