An electronic board showing the Shanghai and Shenzhen stock indices in the Lujiazui financial district after the outbreak of the novel coronavirus disease (COVID-19) in Shanghai, China, October 25, 2022.Reuters/Aly Song/File Photo Acquisition of license rights
BEIJING/SHANGHAI, Aug 27 (Reuters) – China will impose a stamp duty on stock trading from Monday in its latest attempt to shore up a sluggish market amid a slow recovery in the world’s second-largest economy. half price.
In a brief statement on Sunday, the Treasury said it would reduce the 0.1% tariff on stock trading “to revitalize capital markets and boost investor confidence.”
Reuters reported on Friday that authorities plan to cut tariffs by as much as half after major stock indexes fell to nine-month lows.
“These policies will boost the market in the short term, but they won’t have much effect in the long term,” said Xie Chen, fund manager at Shanghai Jianwen Investment Management, before the announcement. “The rebound can last only a few days, or even less.”
In parallel with the Ministry of Finance’s move, the China Securities Regulatory Commission (CSRC) is rolling out measures to boost market confidence in investing in listed companies.
The CSRC said on Sunday that China will slow down the pace of initial public offerings (IPOs) and further regulate the cutbacks of major shareholders.
Meanwhile, Chinese stock exchanges have lowered their margin requirements, according to a CSRC announcement.
Chinese leaders pledged late last month to revive the world’s second-largest stock market, reeling from signs of a post-pandemic recovery and a deepening debt crisis in the property market.
The Chinese government took a series of steps last week, including a smaller-than-expected cut in key lending indicators. But investors are calling for a stronger policy response, including huge government spending.
In the latest sign of an economic downturn, Sunday’s data showed that weak demand weighed on firms, extending the slump in profits of China’s industrial firms to seven months this year.
A person familiar with the matter told Reuters that the Treasury Department and other regulators, following guidance from the State Council, submitted a draft to the cabinet earlier this month to reduce the stamp duty.
Reporting by Judy Hoare and Joe Cash in Beijing and Li Gu in Shanghai.Editing: William Mallard
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