Wu Qing: Improve the construction of a market stabilization mechanism with Chinese characteristics

Caixin “We will continue to promote the effective collaboration of all parties, improve the market mechanism and ecosystem for long-term investment and financing, enhance the construction of a market stabilization mechanism with Chinese characteristics, enrich tools and mechanisms for cross-cycle and counter-cyclical adjustments, and further strengthen the market’s inherent stability.” On March 6, Wu Qing, Chairman of the China Securities Regulatory Commission, stated at the Fourth Session of the 14th National People’s Congress during a press conference on economic topics that stability is an inevitable requirement for high-quality development of the capital market.

At the same press conference, Pan Gongsheng, Governor of the People’s Bank of China, said that in terms of the capital market, the People’s Bank will work with the CSRC to implement supportive policy tools for the capital market, support Central Huijin Investment Ltd. in playing the role of a quasi-stabilization fund, and enhance the market’s internal stability and synergy.

The “national team” known as Central Huijin has been seen as a stabilizing signal through its increased holdings of bank stocks and ETF purchases, acting as a stabilization fund. Previously, during the downturn of the A-share market, Central Huijin had made multiple moves. On October 23, 2023, the A-shares were still hovering around 3,000 points. Over the following three months, several broad-based ETFs saw purchase volumes exceeding 10 billion yuan on multiple single trading days. (See Caixin for “Several Broad-Based Index ETFs See Increased Volume, Is the National Team Entering?”)