Four months after the State Council, China’s cabinet, unveiled a nine-point document aimed at restoring investors’ confidence and attracting long-term funds, the market is back in a downward spiral after a relief rally. There are telltale signs of investors shunning stocks: turnover on the Shanghai and Shenzhen exchanges has plunged to a four-year low, the benchmark CSI 300 Index has lost a tenth of its value from this year’s high and quick sector rotations dominate trading.Instead, investors have been scooping up other assets from bonds to exchange-traded funds (ETFs) tracking overseas equities, and luxury homes in tier-one cities. The frenzy is in sharp contrast to the flagging stock market, with the yield on the benchmark government bond sliding to a record low, ETFs tracking underlying US and Japanese stocks trading at a premium to their net-asset values and new luxury…
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