ABERDEEN Asset Management’s head of Asian operations warned Tuesday that Chinese money was moving “a bit like a casino” in the domestic stock market, while BlackRock called on China to reform its capital markets further to avert boom and bust scenarios.

    China’s stocks have jumped 80 percent since November to trade at seven-year highs. On Monday, Shanghai Stock Exchange trade surpassed 1 trillion yuan (US$161 billion) for the first time, making the bourse the world’s biggest in terms of turnover.

    Recent strong gains have come despite stretched valuations, prompting a warning from Xinhua Monday against “irrational exuberance.”

    Aberdeen’s managing director for Asia, Hugh Young, said he was worried about some speculative activity in the Chinese stock market.

    “Chinese money is moving a bit like a casino and it’s moving offshore. Within the domestic Chinese market, the levels of turnover are tremendous,” he said on the sidelines of a Credit Suisse conference in Singapore.

    His comments came after Larry Fink, CEO of BlackRock, the world’s biggest money manager, said his firm believes China needed more robust capital markets.

    “And by having a more robust capital market, it will mean we’ll have less boom bust. Right now, we are experiencing typical boom bust. Let’s hope it doesn’t end poorly.”

    Fink said China should expand its capital markets, and needs more initial public offerings and better underwriting standards.

    But Aberdeen’s Young said he was not worried about recent stock gains in Hong Kong because the market had not run up like the mainland. Hong Kong’s benchmark index has gained nearly 12 percent so far in April, but is up about 18 percent for the year to date.

    Not all speakers at the conference were downbeat in tone about China’s stock market.

    Robert Parker, a senior advisor at Credit Suisse, said he did not think China equity markets were in a bubble. (SD-Agencies)