CHINA

Chaos Threatens Stock Markets, Beijing Says: China issued a stern warning last week that chaos was threatening its stock markets as investors threw caution to the wind and sent prices skyrocketing on the southern Shenzhen Exchange. “B” shares reserved for foreigners have soared by up to 45% in the past week alone in Shenzhen, following wild demand for “A” shares traded by Chinese citizens. Stock market fever is sweeping China as investors, desperate for a better return than the slim interest rates offered by state banks, battle for limited supplies of stock. Vicious fights have erupted between gangs trying to jump ahead in lines of investors in Shenzhen. Two people have been stabbed to death, and police rounded up 200 gangsters last week to try to stop the violence. In a sign of official alarm, the Beijing-controlled China News Service said chaos could ensue and economic reforms could be endangered if more stock markets opened too soon. Several cities are vying to follow Shanghai and Shenzhen in opening stock markets. “There will be chaos and even an uncontrollable situation if various places in China stampede to set up stock exchanges before problems are solved,” the Hong Kong-based news agency quoted experts as saying.