Latest News:  
Beijing   Light rain/Overcast    25 / 20 ℃  City Forecast

English>>China Business

Stock markets officials lure foreign investors

By Fang Yunyu  (Global Times)

13:19, September 21, 2012

Chinese mainland bourses have possibly sent officials to tour some overseas countries in a bid to lure foreign investors, the latest effort to boost the weak domestic market, sources told the Global Times Thursday.

Officials from the Shanghai and Shenzhen stock exchanges are "meeting institutional investors" in the US, Europe and Japan, trying to convince them to invest in China's stock market, the Financial Times reported Thursday, citing three people briefed on the issue.

"We do not have the relevant information that can be disclosed," Zhang Wei, a media officer at the Shanghai Stock Exchange, told the Global Times Thursday, without denying the so-called "global roadshow" reportedly being conducted by the Shanghai bourse officials.

An executive office staff surnamed Lin from the Shenzhen Stock Exchange told the Global Times that senior bourse officials "are currently out on business trips," and refused to provide more details on the issue.

Since the beginning of this year, the mainland stock markets have had the worst performance in the world, as the Shenzhen index declined by 7.94 percent and the Shanghai index dropped more than 6 percent between January and August.

"Foreign investors are usually value investors. Considering that the Chinese stock markets have hit the bottom, it makes sense for the authorities to urge investors to invest in the market," Li Daxiao, director of the research institute at Yingda Securities, told the Global Times, noting that the world's second largest economy still recorded a 7.6 percent economic growth during the second quarter of this year despite the global downturn.

However, Li also said that the authorities' previous efforts to boost the stock market through domestic investors, who are policy-driven investors, not value investors, have proven to be ineffective.

The China Securities Regulatory Commission (CSRC) announced in early August that the transaction fees of A shares will be cut by 20 percent starting this month, the third such cut this year.

According to the country's securities regulator, based on the trading volumes in 2011, the three cuts could save investors 15.5 billion yuan ($2.46 billion) in trading costs this year.

And the country's biggest steel maker Baoshan Iron & Steel Co disclosed Wednesday that the company is ready to buy back 5 billion yuan worth of its shares, believed to be a boost for the market sentiment, after the CSRC said last month it encouraged companies whose share prices are lower than their net asset value per share to repurchase their own shares.

But the benchmark Shanghai Composite Index Thursday closed at 2,024.84 points, down 2.08 percent, and the Shenzhen Component Index dropped by 2.72 percent.

Li said such a low level provides good opportunities for investors but because domestic investors are not moved by the undervalued share prices, "it leaves the authorities no other way but to seek foreign investors."

The CSRC in July issued a regulation, raising the combined stake the qualified QFIIs can hold in a company listed on the A-share market to reach up to 30 percent from the current 20 percent, a move to make it easier for the QFIIs to invest in the country's capital market.

News we recommend:
Banks need to transform to boost margins Consumer finance set to boom in China Ailing steel industry cheered by construction projects
Chinese firms ramp up presence in Thailand Chinese go online to buy latest iPhone Chinese winemakers demand anti-dumping
Energy conservation: A new investment opportunity  Summer Davos cultural dinner party held in Tianjin Steel producers face bleak months ahead

Email|Print|Comments(Editor:厉振羽、张洪宇)

Leave your comment0 comments

  1. Name

  

Selections for you


  1. PLA Air Force conducts search and rescue exercise

  2. Endeavour takes off for last journey

  3. Foreign realty developers target China

  4. Wang puts her troubles on ice

  5. Sexy & Violence --- Mexican women's wrestling

  6. Funny pictures:the world of brown bears

Most Popular

Opinions

  1. Violent protesters not representative of real issue
  2. China, EU should set example in resolving disputes
  3. Chances of solving Syria crisis regionally ruled out
  4. Japan has never made effort to reflect its past
  5. Global value chains in the world economy
  6. Renaming of South China Sea draws some flak
  7. Returnees should receive a helping hand
  8. U.S. trade dispute with China a mistake
  9. Landings fan protest flames
  10. Politics should not victimize China-US trade

What's happening in China

Chemical leakage turns villages red in Shandong

  1. Shaanxi declines to reveal official's salary
  2. Policeman shot fellow officer, then himself
  3. Renmin University receives $32m donation
  4. Principal defends rejecting autistic boy
  5. Childless elderly to receive government help

China Features

  1. Focus on North Korea's schoolgirls
  2. US suffers 'Arab winter'
  3. To live an amazing life
  4. Survivors tell you how to survive traffic accidents
  5. Why was the U.S. ambassador killed in Libya?

PD Online Data

  1. Ministry of Water Resources
  2. Ministry of Railways
  3. People's Bank of China
  4. Ministry of Health
  5. Ministry of Culture