Goldman Sachs Partially Denies Sending Email That Caused A Massive Selloff In China

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Can you guess the unnamed investment bank that a state-run Chinese newspaper accused of causing a major Shanghai sell-off?

Everyone assumes the bank was Goldman Sachs, naturally, and there must be something to the accusation because Goldman has issued a denial. Or rather, a clarification.

A senior analyst told Caixin:

Zhu Yue, chief China strategic analyst, said Goldman Sachs did not release any new reports on November 12 and a London-based research team advised clients who invest in H-shares to sell their stocks.

Zhu forecasted that China will hike interest rates three times next year and each time by 25 basis points. He said that other counter-inflationary measures will include a tighter credit policy.

H-shares refer to companies incorporated in Hong Kong, as opposed to A-Shares that are incorporated in Shanghai or Shenzhen.

Actually, Goldman is bullish on Chinese equity, despite the rate hikes. Zhu told Caixin he predicted a 10 per cent return in next six months and a 20 per cent return in the next 12 months on A-shares are likely.

Check out Goldman’s key targets on every market in 2011 >

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