A phrase from an article by Tom Holland in SCMP today which quite accurately describes the China's stock market performance which is still trading at where it was 13 years ago.
"China's stock markets did not evolve as places where private companies could raise long-term capital from investors prepared to risk their savings for superior returns.
Instead they were set up by the Communist Party to further its own political aims of reforming China's state-owned enterprises to ensure their continued dominance over the economy.
As a result, the listing rules were drawn up explicitly to favour big state-run corporations in sectors considered strategic by Beijing, with private companies in China's fast growing service economy largely excluded."
As for Hong Kong market which is considered a proxy to China, Hong Kong has attached itself so much to China in everything that the Hong Kong market largely follows China's dismal stock performance, unfortunately. This includes Hong Kong's economy which cater much to China's consumers and in a way ignores the rest of the world. Now that China's economy is starting to slow down, owing to its own insatiable appetite which is causing overcapacity, over-leveraging, over-expansion, over-bought overseas resources/assets and over-everything, Hong Kong's economy and stock market have to bear China's slowdown. Many are becoming optimistic about HK/China's markets as they are so dirt cheap, I'm not optimistic on the other hand.