The Shanghai Composite has now recovered a bit since I first began this post (I just found it again). 

Important points: The government is trying everything short of actually buying shares to turn around the stock market, buyers are not yet convinced that the market HAS hit bottom (and at 28 times earnings, maybe with good reason), and the market was in a bit of a bubble at last October's peak.

Expensive Shares (from Bloomberg.com, April 26)

Shares in the CSI 300 now trade at 28.1 times profit, still the highest among 14 Asian countries tracked by Bloomberg. Corporate earnings growth this year may disappoint investors as costs rise and gains from investment income drop, Morgan Stanley analysts Jerry Lou and Allen Gui said in a report last week.

The government may need to implement more measures should the Shanghai Stock Exchange Composite Index, another benchmark for Chinese shares, fall 15 percent, according to Wu Youhui, a strategy analyst at GF Securities Co. in Guangzhou. The index closed at 3,557.75 on April 25.

“Tightening secondary financing by listed companies and allowing margin financing are among possible choices,” Citic Securities's Weiqing said.

The Shanghai Composite Index closed on April 30 at 3693.11, up 169.70 or 4.92%!!!  We'll see how the market fared over the long holiday.  Unlike the U.S. stock markets (which are never closed more than 3 days in a row), the Chinese markets were closed for the entire Labor Day holiday (5 days).