(Bloomberg) — China acted to cool the speculative frenzy in its $9.5 trillion stock market, ending a euphoric eight-day surge that had fueled worries of a new bubble in the making.
Signs of Beijing’s unease over the rally’s speed emerged late Thursday, when a pair of government-owned funds announced plans to trim holdings of stocks that soared this week. On Friday the state-run China Economic Times warned about the dangers of a “crazy” bull market, while Caixin reported that regulators had asked mutual fund companies to cap the size of new products.
Traders said the moves amounted to a warning from Chinese officialdom that the country’s world-beating equity boom has gone too far, too fast. While cheerleading from state-run media helped ignite gains at the end of last month, authorities appear keen to engineer a steady bull market rather than a repeat of the bubble that ended in a $5