China's securities regulator steps up efforts to boost market confidence
China's top securities regulator has specified an array of initiatives aimed at invigorating the capital market and boosting investor confidence to stabilize market expectations.
The China Securities Regulatory Commission said Friday it would accelerate reform at the investment end, make listed companies more attractive for investment, and optimize and improve trading mechanisms.
This will be done by implementing 25 measures including axing stock transaction fees, lowering the index fund registration thresholds, and advancing the development of equity funds.
The launch of the latest policy mix aimed at boosting the capital market indicates that stabilizing capital market expectations is of great significance for maintaining China's overall economic and social stability, said the commission.
Noting that the capital market is highly correlated with the economy and is known as an economic barometer, Herbert Zhang, chief executive officer of China Universal Asset Management, said investors and the whole society will be able to build stronger confidence and expectation for the country's economic development if a stable and active capital market is in place.
A capital market with a virtuous cycle of investment and financing will contribute to high-quality economic development and is an effective way to expand domestic demand and promote consumption, said Zhang.
Chinese authorities have described the country's economic recovery as a wave-like development and a tortuous process, which requires efforts to push for the continuous improvement of economic performance, the endogenous driving force and social expectations, while also continuously defusing risks and hidden dangers.
The long-term fundamentals for sound development have remained unchanged as the country's economy has great resilience and potential.
Industry insiders have already seen the growth potential of the capital market, when enhanced by certain newly-introduced measures.
Measures such as introducing medium- and long-term funds, creating better return for investors and improving transaction convenience will effectively enhance the vitality, efficiency and attractiveness of the market, said Liu Xiaoyan, chief executive officer of E Fund Management Co., Ltd.
Liu added that with the latest policy mix coming into play, the capital market's functions of resource allocation, price discovery, and risk management will play an improved role and the market will have a positive interaction with the real economy.
Multiple financial institutions have pointed out that these measures place emphasis on introducing more resources for the capital market, as many focus on expanding the scope of investors, facilitating investment, and enriching products.
Lin Chuanhui, chairman of GF Securities Co, Ltd., said the measures are expected to enhance investors' sense of gain, stabilize their expectations for the future, and motivate them to allocate more assets to the capital market.
This policy mix is conducive to stimulating the wealth effect of the capital market, allowing investors to share in the dividends of China's economic growth and the results of enterprises' innovation and development, Lin said.
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