In this paper, we measure and evaluate the financial stability of China's financial system, and cyclical characteristics of financial stability are analyzed as well. After selecting proper variables, we construct a financial stress index to characterize the stress state of financial system. A specific markov switching model is used to analyze current stress state of financial system and forecast the future financial stress in 2013. Analysis demonstrates that financial system was in stable regime in 2012 and financial stress decreased gradually to low-stress regime. Forecasting indicate that in 2013 the stress state of China's financial system will pick up slowly, switching from low-stress regime to mid-stress regime, but will still below the median of mid-stress regime. <<