Market Sell Off… maybe
China markets sold off because of the increase tax requirement from capital gains. It went from 0.1 to 0.3 percent. This was done to cool down some market speculation. It worked last time for a bit, but the markets still went up irrespective after a few months. Same will happen now.
Keep in mind, the west found out about this increase around noon yesterday (while their markets were closed), and our markets did not sell off. Any reasonable investor would have been thinking about a sell off in China the following morning… which obviously happened. The Shanghai Index was down 6.5% on the news.
If our markets experience a breakdown due to this, buy the names you always wanted to buy. It is a bullshit reason for our markets to be down. A sell off in other markets would be a pure psychological sell off, nothing more.
