The Influence of Foreign Stock Markets on Chinese Stock Markets during the period of Subprime Crisis in 2008

In this paper, several major composite indices from Chinese stock markets and some developed countries are researched. The developed countries belong to the countries who had been highly influenced by the subprime crisis in 2008, including Australia, German, French, Japan, United states of American, United kingdom. Our research shows the Chinese stock markets in mainland have been highly influenced by the stock markets in American, Australia, Japan and Hong Kong. We find that the four countries and region are just the countries who have closed trade relations with China mainland. It also denotes the trade relationship is a major way of financial crisis spreading.