China escalated its defense of the stock market, as state-backed funds answered the government’s rallying call by increasing purchases and more companies stepped up buyback plans. A basket of nine exchange-traded funds favored by the so-called national team drew 76.7 billion yuan ($11.5 billion) of inflows on Tuesday, according to Bloomberg-compiled data. That was the second largest on record.
Turnover for those funds came in at around 83 billion yuan on Wednesday, higher than in most sessions this quarter. The tech-heavy Star 50 Index surged nearly 10% on Wednesday, its best session since July. The CSI 300 Index gained more than 2%. The rebound also tracked a broad move higher in Asia as investors digested the US midterm election results.
Chinese companies are also being enlisted in the effort to shore up confidence. CXMT Corp.’s chairman proposed Wednesday to increase the size of its share buyback to between 2.5 billion yuan to 5 billion yuan. Suzhou Dongshan Precision Manufacturing Co.’s controlling shareholders proposed returning at least 1 billion yuan to investors in 2026 through cash dividends and share buybacks. The plans came after the People’s Bank of China said it would cut the rate on its relending facility to 1% from 1.25%. Chinese banks have already submitted applications for more than 200 billion yuan of relending quotas, the PBOC said.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing