Consider_this

Ultimate Economic Showdown: China vs. the U.S.

China's exchange "PEG" with the dollar hasn't changed, despite USD raising almost 20%+ in a short time. It has gradually floated "up" from 1 dollar = 8 yuan at about Jan 07, to about 1 USD = 6.8 today.

This acts as a double whammy against it's exports: (A) It's export did not become cheaper from the USA's perspective even as USD climbed. It's exported goods are just as equally expensive as a few months back, if not more so. (B) The yuan increased relative to other countries, like EUR or rest of Asia, which makes these regions consume less goods from China.

Also consider that the Chinese govt has scaled back the tax benefits of exporting.

And yet, the yuan is still relatively pegged against USD and shows no sign of reversing it's climb against USD. What does this tell you?

It says that China is intentionally weaning off it's export dependence. It's yuan, as it gets strong, will one day no longer need to "PEG" to USD. A strong currency will also start to serve boost domestic consumption power.

In this backdrop...

Try pricing the China's stock market value against other measures: like EUR, Gold, etc. And you'll see that Chinese stock market didn't really drop as much as the above graph suggests.

That's pretty impressive for an Emerging Market country.