– This is the script of CNBC's news report for China's CCTV on July 28, Tuesday.
Welcome to CNBC Business Daily, I'm Qian Chen.
Chinese equities remained volatile Tuesday following an initial stampede out of the market, with analysts cautioning that there is no clear end in sight to the drama.
[Mark Eibel, Investment Strategist] "Just another painful lesson that we learnt in the States with the technology in the 90s is that web goes straight up, isn't sustainable, lots of margin to count, individuals are holding them, that's not the recipe that ends well. So we need to get through this episode, and get back to the broader story."
The Fed begins its two-day meeting Tuesday, but economists mostly expect little news from the U.S. central bank when it releases its statement Wednesday afternoon. The majority of economists forecast the Fed will raise rates for the first time in September, unless the economic data soften significantly or there is some other shock to the system.
And some are concerned that China could potentially create a shock.
However, analysts say China's stock market selloff is unlikely to slow the Fed's path to rate hikes, unless it creates an economic slowdown or deflationary spiral that slams the global economy.
[TAI HUI, J.P. Morgan Funds, Chief Asia Market Strategist] "If you look at China, I think the macro economy backdrop of China is more important than the equity performance, in the past 6-9 months. So from that perspective, I'm expecting the Fed to start moving as early as September, and the most important footprint, is that the Fed will move in a very very gradual manner."
Stocks account for only about 9 percent of household wealth in China, and major market indices are still higher on the year, so relatively few regular Chinese were severely burned by Monday's move. Still, the fallout from July's downturn-and the unsuccessful government interventions that followed-could damage Beijing's credibility when it comes to exerting control over markets.
The benchmark Shanghai Composite opened down over 4 percent on Tuesday, swinging between losses and gains over the course of the morning session, as investor sentiment remained shaky despite a fresh commitment by Beijing to put a floor under the market.
So, where do investors go from here?
For those with a strong stomach for volatility and a longer investment horizon, strategists recommend gaining exposure to H-shares, or Hong Kong-listed mainland stocks.
[CHRIS KONSTANTINOS, Riverfront Investment Group, Director of International Portfolio Management] "But I would say if you are extremely risk tolerant and you have a long time horizon and you don't mind trying to catch a falling knife the H-Share market the mainland companies in China they are listed in Hongkong Exchanges which have been available to global investors for many years those valuation are now starting to get down into the range where we think there is probably some long-term valuation support there cause that market is trading at some 10 times earning right now so again for the contrarians(?) out there with really risk tolerant maybe watching the H-Share market might be interesting but the A-share market is still vulnerable]
Meanwhile, some analysts remain bullish in the long run. Here's what Andrew Sullivan, MD of Haitong International, got to say.
[Andrew Sullivan, MD, Haitong International] "But I think a lot of investors who sold in that initial rally in April and stood away, are looking to maybe pick up some stocks they sold because they are back at the levels that they were prior to the rally. So long-term investors still have good opportunities."
CNBC's Qian Chen, reporting from Singapore.