Extraordinary times. This comes in mind first when I’m looking back to the month of September. Extraordinary volatility, events and an outlook that’s still uncertain. October 2nd. may be a better time to find directions for the market following the vote in the House but for now we have to focus on past events. Looking at the chart tracking major indices in 2008 doesn’t make investors smile. The DJIA lost over 20% by September 29 though it came back 485 points on the 30th—the best day in six years. But make no mistake, the third quarter of this year was one of the worst for China stock investors since 2001.

Here is the map of today's bloodbath. As predicted, CNOOC Ltd. (CEO) is hit the hardest - ADR lost $7.35 by mid afternoon. As we predicted in the morning before the bell, Chinese solar companies plunged, too. We argued that the sector is considered risky based on trading characteristics - and the fall of TSL, SDK and JASO clearly underlines our uneasiness of the sector.

Chinese solar ADRs are extremely volatile. As the following summary table reveals, shares of Solarfun Power (SOLF) are up 47% just in August yet investors bought into the company on January 2nd. are down 45% year-to-date (YTD). And Solarfun is no exception. All Chinese solar ADRs but Canadian Solar (CSIQ) are trading way below their January 2, 2008 level turning this hot sector of 2007 into disaster in 2008.

There is not much direction to find in market sentiment lately. While February turned to be a comeback for Chinese shares listed in the Hong Kong Stock Exchange, the same stocks nosedived in the U.S. the last trading day of the month tracking major U.S. indices lower. As the chart on the page demonstrates, February was somewhat an improvement over January for stocks in Hong Kong measured by the blue chip Hang Seng Index. Stocks posted their best monthly gain since October in Hong Kong. At the same time, the selloff on February 29 in the U.S., a day the DJIA fell 315.79 points, left the stock market stuck in a rut with no clear indication to get any better. As the saying goes, it will get worse before it gets better… The U.S. listed stock universe, measured by the China ADR Index (CAI) has not been able to recover January losses and fell heavily on Friday along overall market sentiment.

Chinese ADRs are trading sideways by noon with strenght in the solar sector. Ja Solar is taking the lead followed closely by CSIQ and STP. Ja Solar is up $1.57 or 9.91% at $17.42 by noon. Another China NASDAQ Index (CQI) heavyweight, BIDU, is up $6.38 to trade at $240.69 after Pacific Crest analyst Steve Weinstein raised his rating on the stock to Outperform from Sector Perform, setting a $350 price target. Baidu.com is trying to find support at current price level after falling -38.33% YTD.

1:00 pm : The major indices are trading near their best levels of the session after a broad-based rebound. Baidu.com Inc. (BIDU) came back especially strong lifing the China NASDAQ ADR Index or CQI. China's solar companies are showing some strength, JA Solar Holdings Co. (JASO) and China Sunergy Co. (CSUN) in particular.

Chinese stocks pulled back on jittery U.S. market sentiment after a Federal Reserve official suggested rising inflation could prevent the central bank from making further interest rate cuts. The measure for the performance of Chinese stocks on U.S. exchanges, the China ADR Index (CAI), lost -29.34 points today to close at 838.4.

Chinese stocks listed on American exchanges are down for the year 2008, tracking Wall Street sentiment relatively closely. CAI, CYI and CQI are market cap weighted indices and as such are tracking large cap companies very closely. China telecom sector got caught on fire in the afternoon on news of a possible industry revamp and its implications. CHU, China's smaller mobile carrier is expected to benefir from the industry reshuffle. China Unicom rose 2.2% to $22.78.

U.S. listed Chinese stocks came back strongly by the end of the day, NYSE names in particular. China Mobile (CHL), China's largest mobile operator came back especially strong by gaining $2.67 or 3.75 percent on Friday to finish at $77.39. Some of the institutional investors made use of the opportunity to pick up good quality stocks.

U.S. listed Chinese ADRs plunged on Thursday, suffering their worst two-day fall. As the following table shows, the "China ADR Index" (CAI) is down by -12.28% year-to-date (YTD), the "China NYSE Index" (CYI) is down by -11.95% YTD, and the "China NASDAQ Index" (CQI) is down by -21.0% YTD. These indices are market cap weighted and are set at 1,000 as of January 1, 2008.

Renewable energy industry has grown rapidly while the oil prices keep hitting high records. The PV market demand has grown exponentially in the past decade to increase the utilization of abundant nature solar energy. According to Solarbuzz projection, PV industry revenues will reach US$18.6 billion by 2010, representing an annual growing rate of 13.7% from 2005. With players like STP, JASO, YGE, CISQ, SOLF, CSUN, TSL - all from China - it pays off to separate the darlings from the dogs. This blog entry is just a short relection on Suntech, one of the biggest players in the field.

I have been following Chinese ADRs (U.S. listed Chinese companies) for a long time to realize a change in the dynamics of new IPOs. Investors have to be very selective when it comes to Chines IPOs, especially that high quality Chinese companies seems to choose Hong Kong and Shanghai lately.