The month of August is a roller-coaster ride for global investors with global markets correcting more than 10%, as a result of the fear of the slowing Chinese Economy. The sudden devaluation of the Chinese Yuan sparked off fears of a potential currency war leading to one of the worst one day drop in recent times. Dubbed as Black Monday, global stock markets fell between 3-9% on 24 th August and continued to fall for the next few days. There was so much fear prior to the opening of the US Stock market that the US index Futures hit their Limit Down before the opening of the US stock market that morning. Limit Down is a safety mechanism by a stock exchange to limit the fall of an index to a certain percentage (10% in most cases) to prevent fear and panic among the investors.
The Black Monday may be the beginning of the end, for China......