China's stock market index breached the 4,000 mark for the first time on Wednesday as the value of shares traded was higher than rest of Asia, including Japan, Financial Times said in a report.
The record turnover was all the more impressive, given that day trading is not allowed in China.
FT further pointed out that this is a significant landmark considering that the trading volume on Chinese markets was only $5 billion a day six months ago. The figure, however, touched $16.4 billion on March 30.
The Shanghai stock exchange's turnover stood at Rmb255.3 billion ($33.2 billion) on Wednesday, while the smaller Shenzhen exchange had Rmb121.6 billion ($15.8 billion) worth of shares traded. This brought the total for Chinese market to Rmb376.9 billion ($49 billion), 21 per cent higher than the previous record set in April.
The FT report said this phenomenal increase was a result of the revival of retail interest in a market that has climbed 300 per cent in less than two years. Wednesday's jump pushed the benchmark Shanghai Composite Index up 1.6 per cent to close at 4,013.09. Moreover, with inflation now above 3 per cent in China, negative real returns offered by bank deposits also fuelled the stock frenzy, FT said.
Wednesday's figure of $49 billion was nearly double of Japan's $26.9 billion turnover and triple the $16.5 billion combined trading volume of Australia, Hong Kong, Thailand, Singapore, Malaysia, Korea, India, Taiwan, Indonesia, New Zealand and Vietnam.
Though the Chinese market is the world's second-largest in terms of turnover, it is still less than half the size of Japan's in market capitalisation, with Shenzhen and Shanghai boasting $2,200 billion compared to Japan's $4,700 billion, the UK's near-$4,000 billion and the US' $16,500 billion.
Shanghai Stock Exchange
