Moody's Report Sparks Selloff in Chinese Firms

" The Moody's report is another excuse for people to sell off these stocks," said Patrick Shum, president of BMI Funds Management Ltd in Hong Kong.

" Some of the Chinese companies have operational practices that are questionable, but it may not be just concentrated in certain sectors that we've seen. So far, we haven't seen gambling stocks or retail stocks being targeted, but it's hard to say who will be next," he added.

Accounting scandals at U.S.-listed companies based in China have been the subject of regulatory probes and dozens of investor lawsuits in America. A number of companies were highlighted in research reports by short-sellers.

Moody's said it screened 49 junk-rated companies and a few investment-grade firms in China against 20 yardsticks it called 'red flags', grouped into five categories: weak corporate governance, risky business models, fast-growth strategies, poor earnings quality and audit concerns.

 

teeth53      ( Date: 12-Jul-2011 17:19) Posted: Hong Kong headed the fall by more then 3%. it is a difficult to dip below 3,000 unless Obama admin  is unable to handle U.S. debt, so is the congress....Aug 2 deadline. Market can be volatile till end of July and just B4 Aug 2, there after, DOW trading can enjoy a little more stability. See oso China monetary policies on thightening it fight against inflation and it interest rate, and on PIIG (EU), will hav some news on greece debt (news will neither be good or bad as greece must roll over their $340 billion debt.). http://www.nst.com.my/nst/articles/Chinainflationacceleratesto6_4_/Article/ China June Inflation Rose 6.4% Nikkei 225  -143.61  9,925.92     Hang Seng  -684.07  21,663.16 risktaker      ( Date: 12-Jul-2011 12:10) Posted: BB are no fools. if we do see it break 3000 it means we are in serious trouble and everyone should dump our stock on hands. global economy cannot afford another double like i say. we will see some better reports by end of the week or early next week. it will prove us is just hitting a soft patch. BUY on Di

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DBSV Weekly commentary

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