China

Signals

China Banks Drawdown+3 pts

China Large-Cap (FXI) banks component -8% in 5 days — Chinese banking stressWhy it matters: Chinese bank stocks are first to show stress from property/credit issues in China's financial system

China Property Drawdown+2 pts

China Overseas Land (0688.HK) -5% in 5 days — property sector stressWhy it matters: China's property sector is a key systemic risk; drawdowns signal potential contagion to banks and broader economy

China Credit Stress+2 pts

China Bond ETF (CBON) -3% in 3 days — credit market deteriorationWhy it matters: Chinese credit stress often precedes broader EM contagion and signals tightening financial conditions

China Credit Drawdown+2 pts

China credit proxy -5% in 5 days — broad credit deteriorationWhy it matters: Sustained credit drawdown indicates deepening financial stress in China

China Market Drawdown+2 pts

China Large-Cap (FXI) -5% in 5 days — broad Chinese equity weaknessWhy it matters: Broad equity weakness confirms stress is affecting the wider Chinese market

China FX Stress+2 pts

CNY/USD move >3% in 3 days — yuan depreciation pressureWhy it matters: Rapid yuan weakening signals capital flight and potential PBOC intervention risk

China Volatility Elevated+1 pts

China market volatility above 35 — elevated uncertaintyWhy it matters: Elevated volatility indicates market uncertainty and potential for sharp moves

China Market Stable+0 pts

China Large-Cap (FXI) holding above -3% over 5 days — no broad sell-offWhy it matters: Market stability indicator — if met, stress may be contained to specific sectors

China Market Stable+0 pts

China Large-Cap (FXI) holding above -3% over 5 days — no broad sell-offWhy it matters: Market stability indicator — if met, stress may be contained to specific sectors

China Property Drawdown+2 pts

China Overseas Land (0688.HK) -5% in 5 days — property sector stressWhy it matters: China's property sector is a key systemic risk; drawdowns signal potential contagion

Instruments tracked

MKT — iShares China Large-Cap ETF (FXI)

Broadest China equity proxy. Tracks the largest Chinese companies listed in Hong Kong.Calm 5d > -1% · Watch 5d -1% to -5% · Stress 5d < -5%

BANK — Bank of China (3988.HK)

Chinese banks are exposed to property developer debt and local government financing vehicles (LGFVs). First to show systemic stress.Calm 5d > -3% · Watch 5d -3% to -8% · Stress 5d < -8%

CRD — VanEck China Bond ETF (CBON)

Chinese onshore bond market proxy. Stress here signals tightening financial conditions and potential PBOC intervention.Calm 5d > -1% · Watch 5d -1% to -3% · Stress 5d < -3%

RE — China Overseas Land & Investment (0688.HK)

China property sector — the single biggest systemic risk. Evergrande, Country Garden, etc. Drawdowns signal potential contagion to banks.Calm 5d > -3% · Watch 5d -3% to -10% · Stress 5d < -10%

FX — Chinese Yuan (CNY/USD)

Yuan depreciation signals capital flight and potential PBOC intervention. Managed float means moves are policy-significant.Calm 3d < +0.5% · Watch 3d +0.5% to +1.5% · Stress 3d > +1.5%

Past crises that hit China

• China Devaluation / EM CrisisAug 2015 – Feb 2016

  PBoC surprised markets with CNY devaluation, triggering global EM selloff and commodity crash. Oil fell below $30.

  Peak VIX 40.74 · S&P 500 drawdown -14.2%