China Stock Indexes Lost 20% in 2011

The total market value of stocks listed on China’s stock exchanges fell from 30.5 trillion yuan ($4.8 bil.) at the end of 2010 to 24.6 trillion yuan ($3.9 bil.) when trading ended this December 30. That represents about a 20% drop in value.

The Shanghai composite index closed at 2,199.42, 21.68% below the 2010 year-end close. The Shenzhen stock exchange index plunged 29.9% to end at 8.918.82.

China’s stock declines were blamed mainly on uncertainty over the economic stability of the EU zone and the US. Ironically, major US stock indexes posted solid gains for the year. The Dow Jones and the S&P500 both rose, with the Dow posting a 6.13% gain, one of the world’s highest. Gains were also seen in Mexico and Indonesia. But European markets slid, with Germany’s DAX falling 15% and France’s CAC40 dropping 18.44%. Many markets fell over 30%, including those in Egypt, Austria, Finland and Argentina. Greek stocks lost nearly 53% of their value during 2011.

But Chinese stock markets also showed signs of vitality. The total number of listed companies rose from 2,149 to 2,428. Total share volume also from 3.328 trillion shares to 3.618 trillion. The plunge in stock values was attributable mainly to the nearly 6 trillion yuan ($952 billion) in A shares that became worthless this year.

China’s individual stock investors total losses of over 400 billion ($63.5 billion) this year, with average losses of 42,000 yuan ($6,670). A-share stocks fell in 2,119 out of 2,320 listings, or 91.3%.

Over four out of five invests (82.5%) reported losing money in equities this year. Over a third (35%) suffered losses of at least 50% of their total investments, according to a Netease Finance survey of 24,000 stock investors in China.