China halts listings in bid to bolster struggling markets

{"text":[[{"start":8.56,"text":"Chinese regulators have told banks to hold fire on company listings and large share sales in an effort to bolster the country’s struggling stock markets."}],[{"start":17.54,"text":"The China Securities Regulatory Commission has held meetings with investment banks and given informal instructions — or “window guidance” — in the past few days about pausing initial public offerings, according to three people with knowledge of the discussions."}],[{"start":32.42,"text":"Large sales by existing shareholders have also been temporarily suspended until the markets have recovered."}],[{"start":38.6,"text":"The CSI 300, mainland China’s benchmark index, fell 8.5 per cent in October for its worst month in more than a decade. It is down about 14 per cent this year, while the S&P 500 has gained 10 per cent."}],[{"start":null,"text":"

"}],[{"start":53,"text":"Chinese equities have been mired in a prolonged downturn since the summer, pressured by macroeconomic issues and mounting scepticism about AI investment. A tax crackdown on offshore trusts has also prompted some billionaires to sell stocks to pay their tax bills, further weighing on markets."}],[{"start":70.2,"text":"Earlier interventions, ranging from state-backed fund purchases in July to recent regulatory measures limiting share sales, have failed to reverse the decline."}],[{"start":79.28,"text":"Chinese policymakers have previously slowed the pace of IPOs during market downturns as part of attempts to preserve liquidity."}],[{"start":86.8,"text":"The move threatens to put the brakes on dealmaking in China’s equity markets, which had shown signs of revival after a prolonged downturn. IPO deal volume this year has reached more than Rmb292bn ($44bn) — the highest since 2023 — according to Bloomberg data. Chipmaker YMTC is one company that had been expected to list this year, but is yet to do so."}],[{"start":109.4,"text":"The new measures are in addition to earlier guidance last month that included stabilisation methods such as accelerated share buybacks and asking investors to curb equity sales, according to the people."}],[{"start":120.32,"text":"The moves were “unlikely to generate a lasting turnaround unless paired with something that addresses the structural challenges more directly”, said Thomas Mathews, Asia-Pacific head of markets at Capital Economics. “That means boosting earnings growth, which in the near term probably means monetary or fiscal support.”"}],[{"start":137.7,"text":"On Monday the CSRC, People’s Bank of China, and National Financial Regulatory Administration said they held meetings with securities brokerages and fund companies on ways to stabilise stock markets. Measures include cutting the rate on its relending facility for share buybacks to 1 per cent from 1.25 per cent, boosting swap operations and encouraging share buybacks."}],[{"start":162.04,"text":"Market reaction was muted on Tuesday, with the CSI 300 down 0.7 per cent and the tech-focused Star 50 index falling 4.6 per cent, while Hong Kong’s Hang Seng index gained 0.3 per cent."}],[{"start":176.32,"text":"Sam Konrad, investment manager at Jupiter Asset Management, said: “This is an example of why we don’t have a fundamentally positive view on the long-term outlook for Chinese equity markets. It’s a suggestion that Chinese equity markets are reliant on government support to try and boost them.”"}],[{"start":193.68,"text":"He added: “Over the long term Chinese equity markets have been some of the worst-performing equity markets in the world. We think the economic system in China means growth is not translated into earnings growth.”"}],[{"start":205.6,"text":"Jason Lui, head of Asia-Pacific equity and derivative strategy at BNP Paribas, said: “While these policies may not trigger an immediate reversal of sentiment similar to September 2024, they present medium-term opportunities for investors seeking to accumulate China A-share exposure.”"}],[{"start":223.8,"text":"Chinese stocks rebounded in September and October 2024 after regulators unleashed a wave of stimulus, including two central bank liquidity facilities designed to help brokers and institutional investors buy shares."}],[{"start":237.32,"text":"The rally gained further momentum in early 2025 as DeepSeek’s breakthrough prompted global investors to revalue Chinese technology stocks. But confidence was shaken by Donald Trump’s tariff war, prompting Beijing to mobilise state-backed funds, known as the “national team”, to help set a floor for China’s stock markets from April last year."}],[{"start":257.84,"text":"However, rounds of sales in the national team’s ETF and stock holdings in the first quarter of 2026 renewed doubts about the rally’s sustainability."}],[{"start":267.18,"text":"The CSRC did not immediately respond to a request for comment."}],[{"start":275.39,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1793694158_9916.mp3"}