The turnaround since yesterday has been rather remarkable as hopes for stimulus is buoying sentiment in Chinese markets over the past two days. Yes, the “plunge protection team” may be in play too but it is quite the rebound when you look at the charts:
The CSI 300 index is looking to hang on at its 200-week moving average (blue line) while the Hang Seng is rebounding strongly after meeting its 2016 low. It is a bit early to say that this is the bottom but there are certainly value investors out there stepping in as it would seem.
A lot of the commentary has also erred towards that so it will be interesting to see if Chinese authorities will do more to keep the market supported. The CSI 300 index is up 2.6% on the day while the Hang Seng is up 5.7% currently.