stock market photo: Xinhua

More than 7.3 billion yuan ($1.06 billion) flew out of the Shenzhen stock exchange under the Shenzhen-Hong Kong Stock Connect on Wednesday, setting a record amid global market volatility. 

The historical outflow came during a time of high uncertainty in the global financial markets, as a result of the coronavirus outbreak and an oil price shock, and the capital outflow may signify a short-term bleak view of China's stock market, according to Dong Dengxin, director of the Finance and Securities Institute at the Wuhan University of Science and Technology.

"The performance of China's stock market was stronger than other markets in the world last week, despite the fears and concerns over the coronavirus outbreak,"Dong said, "but while many are talking about it as if it's the next safe haven, there are still short-term volatility risks."

Undermined by steep oil price drops and weak demand following the coronavirus outbreak, major stock market underwent upheavals. The Cboe Volatility Index (VIX), which measures market fears, spiked to its highest intraday level since 2008 on Monday. 

So far this year, the S&P500 index has dropped 10.8 percent while the Shanghai index is down 1.4 percent, according to Reuters. 

"However, against the background of global uncertainty, investors, especially private investors, will get in and out of China's market more frequently, and it will definitely encourage more dip buyers," Dong said.

Apart from market volatility, the fast outflow also resulted from the easy access to the Shenzhen-Hong Kong Stock Connect scheme, according to Dong. The low threshold for investors to enter means a large number of private investors are in the market, who tend to be less stable than institutional investors.