China's "Shanqhai" stock index fell sharply

Observers have warned investors about the possibility of sharp price decline

Baku. 27 June. REPORT.AZ/ "Shanqhai Composite" (SSEC) index considered a key indicator of China's stock market decreased by 19% or 985 points amounting to 4 193 points on June 12. But we should keep in mind that on March 9, the SSEC index to 3 198 points increased by 62% or 1 980 points over 3 months and reached 5 178 points. Moreover, the volume of stock exchange transactions exceeded 198 billion dollars.For comparison, the volume of average daily deals in New York Stock Exchange is 40-50 billion dollars.

"Report" informs demand by local investors for China's stock market has increased.Thus, 1.14 million new investor accounts were opened in stock market last week.Another reason for the sharp increase in the prices of stocks in China is a bit of slowdown in the economy and strong tax policy drive local investors to buy stocks.

US "Bank of America Merryl Lynch," noted that China is at the risk of increasing the volume of deals, and warned investors about the possibility of sharp price decline.

In May of 2015, Memorandum of Understanding was signed between the State Oil Fund of Azerbaijan (SOFAZ) and the People's Bank of China (PBC) on Chinese state investment in bonds and shares.

Also, the SOFAZ financial market in China 3 billion. yuan (about 500 mln US dollars) of investment for the implementation of an agreement signed between the parties.

Also, relevant agreement was signed between the parties on 3 billion yuans (about 500 mln US dollars) of investment in China's financial market by SOFAZ. At the same time, the Foundation is exploring the possibility of investing in the stock market.

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