China's stock market is experiencing significant challenges as net negative cumulative equity flows from overseas investors reflect pessimistic sentiment. The situation is exacerbated by 220 million retail investors avoiding the stock market, contributing to a broader trend of funds shifting from equities to bonds, ETFs, and luxury homes. Additionally, net Foreign Direct Investment (FDI) withdrawals from China have reached a record high, with a $12.1 billion net outflow in the third quarter of last year and a substantial decline in net FDI inflows for 2023. Top private equity firms are also slowing down their dealmaking activities in China, further highlighting the downbeat market conditions.