Goldman Sachs: What's Happening to Its China Goldmine?

Eddy Elfenbein submits: Shares of Goldman Sachs (GS) were whacked especially hard on Tuesday. I noted that it was the eighth-worst performing stock in the entire S&P 500.

The reason may have to do with the Industrial & Commercial Bank of China, or ICBC (1398.HK). Last year, Goldman put up $2.6 billion for 5% of the bank. Hank Paulson made several trips to China to secure a role in the IPO. In the end, Goldman lost out to Merrill (MER), Credit Suisse (CS) and Deutsche Bank (DB).

Despite the snub, when the shares went public last year, Goldman made a huge profit. In fact, it was probably the largest profit for any trade anywhere. In less than nine months, Goldman made $4 billion. The investment was made with Goldman's GS Capital Partners V fund, which is heavily owned by Goldman's top execs.

But look at ICBC lately:

GS 1-yr chart