China’s confidences regulator unveiled a series of measures to aid the country’s struggling stock trade in, saying it would encourage funds to help ease liquidity difficulties at heel overed companies, and would support share buy-backs.
Liu Shiyu, Chairman of the China Safe keepings Regulatory Commission (CSRC) also said the regulator would stimulate private equity funds to buy shares in listed firms and speed up imprimatur for mergers and acquisitions, according to a statement on the CSRC’s official website.
Liu also heralded measures to aid private-run businesses, saying the regulator would support the issuance of high-yield connections and other debt instruments by small and medium-sized companies, and would foster asset managers to launch funds that invest in equity or accountability of private companies.
China’s benchmark Shanghai Composite Index slumped 2.9 percent on Thursday in the thick of worries about the levels of borrowing in the stock market and broader affairs over economic growth. Shanghai stocks extended their deteriorations in early trading on Friday, hitting the lowest level since November 2014.
An increasing edition of companies face margin calls as share prices fall.
Multitudinous than 637 billion shares worth 4.44 trillion yuan ($639.86 billion) were pledged for advances as of Oct. 12, according to Reuters’ calculations based on data from the China Safe keepings Depository and Clearing.
Liu said that regulators encourage various patterns of investors, including funds run by local governments, private equity readies, and wealth management products managed by brokerages, to help ease liquidity difficulties at indexed companies with pledged shares.