Chinese Stocks Drop After Greenspan Remarks

Chinese stocks trading in American fell after the former chairman Federal Reserve, Alan Greenspan, said he was concerned that equities in the world's fastest growing major economy might undergo a "dramatic contraction." China Petroleum & Chemical Corp., Asia's largest refiner, led a decline in energy companies on the New York Stock Exchange. Shares of China Life Insurance Co., the country's largest insurer, also retreated. Speaking to a conference in Madrid by satellite, Mr. Greenspan said the rally in Chinese shares "is clearly unsustainable." He joins Asia's richest man, Li Ka-shing, in voicing concern about the stock market in China, where the benchmark CSI 300 Index rose to a record yesterday. The Chinese market "is due for correction," a manager at Acadian Asset Management, Charles Wang, said. "The bubble is reaching its latest stage."