China's top economic officials are promoting openness in Hong Kong, even as authorities on the mainland show how actively they still steer markets. As Vice Premier He Lifeng pledged support for a free and open economic environment in Hong Kong, policymakers in Beijing rolled out a range of measures aimed at influencing asset prices.
The central bank moved to cool the yuan's longest winning streak in three decades, while regulators revived stock-market rescue tools and encouraged more share buybacks. The flurry of intervention highlights the balancing act Beijing faces as it seeks to attract global capital and promote the yuan internationally while retaining firm control over domestic markets. While the yuan weakened, the effort fell flat in stocks: the CSI 300 Index dropped 0.2% and the tech-heavy Star 50 tumbled 3.8%. Some of the same tools, rolled out in 2024, had sparked a huge rally.
The stimulus followed a meeting between officials and securities firms, banks and investors to discuss slumping stocks. Chinese shares have been weighed down by a weak economy and doubts over AI earnings. The CSI 300 fell 8.5% in October, its biggest monthly drop in more than a decade, and has declined a record 12 straight weeks. It is down 13% this year even as most markets elsewhere have rallied.
Anna Wu of Floodlines Research said the effort aims to stabilize financial markets but has a clear long-term perspective rather than an immediate reward. A real turnaround, she said, needs demand-side fiscal support that reaches households, a steadier property market, and evidence that earnings, especially in AI and tech, can justify valuations.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing