China's stock markets tumble to new lows.

That makes prospects bleak for the imminent launch of the second board - and raises further questions about the regulator''s approach.

The Shenzhen and Shanghai stock exchanges tested new lows Monday, with the Shanghai composite index down 33.34 points or 2.26% to 1438.74, its lowest level since December 8 last year, when the index dropped to 1436.66. The Shenzhen composite index dropped to 367.44 points, a fall of 2.8%.

In the last two months alone, the Shanghai A-share market has dropped some 20%.

Given the macro-economic uncertainty the slump is not surprising. Fears of an interest rates hike to cool a possibly overheating economy are causing investors to wait on the sidelines.

Symptomatic of the malaise was another new low in the IPO market,...

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