Salient to Investors:

China’s Shanghai Composite Index erased its 2012 gain on concern a manufacturing slump and Europe will deepen the economic slowdown.

Wu Kan at Dazhong Insurance Co said the Chinese economy is still slowing and earnings growth forecasts have further room to fall, and investors have no idea how slow earnings growth will be.

Shanghai Composite stocks are at 9.59 times estimated earnings versus the average of 17.6 since 2006.

Investors are opening the fewest accounts to trade equities on record on a 30-day average basis going back to August 2007.

Steven Bell at GLC says earnings cuts are the biggest negative for Chinese stocks.

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