China agrees to set up 37 retail funds to help revive the market

China agrees to set up 37 retail funds to help revive the market

SHANGHAI (Reuters) – China’s securities regulator approved the launch of 37 retail funds over the weekend, as part of the government’s efforts to revive a stock market that is struggling to get going in a faltering economy.

The move comes on top of a series of measures to support the market, including lower stamp duty, slower pace of initial public offerings and lower margin financing requirements.

The newly approved funds, which will channel fresh capital into the market, include 10 exchange-traded funds (ETFs) tracking the CSI 2000 small-cap index and seven technology-focused ETFs, according to the China Securities Regulatory Commission (CSRC). website.

The remaining 20 products are innovative mutual funds that charge investors for the first time a floating fee, linked to fund size, performance or holding period.

The Securities and Exchange Commission (CSRC) has pledged to speed up ETF approvals, directing asset managers to lower management and trading fees, among many other market-friendly measures.

China’s leading index, the CSI300, was up more than 5% at the open Monday, but is still down nearly 6% from its peak in April.

China’s leaders pledged late last month to boost investor confidence and reinvigorate the stock market – the world’s second largest – which had been reeling as flags of post-pandemic recovery emerged and the debt crisis worsened in the real estate market.

In an editorial on Monday, the official newspaper China Securities said the latest support measures underscore the authorities’ determination to stabilize the capital market, whose proper functioning is essential to China’s economic recovery.

“A vibrant capital market is the key to stabilizing people’s expectations and increasing confidence,” the editorial said.

“The decision-makers’ determination to revive the market and boost confidence should not be underestimated.”

(Reporting by Shanghai Newsroom; Editing by Shri Navaratnam)

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