SHANGHAI- Dozens of China-listed companies announced plans to buy back shares or scrap plans of stock selling, following a slew of measures authorities took to boost a flagging stock market.
This follows more than a hundred Chinese companies committing to buybacks or withdrawing share sales in August after China imposed new rules as part of measures to shore up a sinking stock market as the country’s post-COVID-19 recovery lost momentum.
Its blue-chip stock index, however, is near one-year lows as investor sentiment remained weak in recent months despite stimulus policies to shore up confidence.
More than a dozen Chinese companies, including China Petroleum & Chemical Corp China Railway Construction Corp China Mobile said in stock exchanges filings on late Monday that they had purchased back their shares or plan to buy back shares in public markets.
Meanwhile, more than 70 other companies in filings vowed that their major shareholders would not sell shares in the coming months, or withdrew plans to offload shares.
Wanma Technology and GoodWe Technologies Co both said in their own statements that their controlling shareholders would not sell stocks in the next six months, based on confidence in their companies’ future development.
It comes as China’s state fund Central Huijin Investment increased stakes in China’s “Big Four” state banks last week, fueling hopes that the authorities would step in to rescue the market.
China’s securities regulator on Saturday said it would restrict securities lending businesses and tighten scrutiny on improper regulatory arbitrage.
The statement from the China Securities Regulatory Commission announced that steps will be taken to strengthen management of securities lending and re-lending businesses, including higher margin requirements, and restricting lending of shares by strategic investors and senior management in newly listed companies.
The rules come amid growing public outcries against short-selling activities amid a lagging stock market. There have also been calls to restrict securities lending by strategic shareholders in newly-listed companies.
Senior management and key employees of Shandong Golden Empire Precision Machinery Technology Co lent their holdings to other investors for sale on the company’s debut in Shanghai, triggering public discontent and a regulatory probe into the activities.
