‘Sound Fundamentals’ will get China through the crisis, says Paper

The official Shanghai Securities News said the recent short-term turmoil in the A-share market was mainly due to external factors and is not expected to last long.

The strong resilience and solid fundamentals of China’s economy have provided a solid foundation for stable and healthy developments in financial markets, a state-run newspaper said Thursday.

Global financial markets have been volatile since Russia invaded Ukraine on Feb. 24, with global stocks falling sharply, oil and other commodities booming and the ruble plunging.

Chinese stocks were no exception. The blue-chip CSI 300 index closed Wednesday at the lowest level since June 2020 and is down nearly 8% this month.

But the official Shanghai Securities News said the recent short-term turmoil in the A-share market was mainly due to external factors and is not expected to last long.

Strong economic fundamentals should determine financial markets over the long term, according to the newspaper. “We have full confidence in the Chinese economy,” he said, quoting several officials from domestic listed companies.

Stabilize expectations

State media added that these companies are ready to adopt various methods to stabilize market expectations of companies and boost investor confidence.

About 30 companies, including liquor-making giant Kweichow Moutai, this week announced their profits in the first two months of this year, a rare move intended to restore market confidence.

Meanwhile, more than 40 companies listed in Shanghai and Shenzhen, including Qi An Xin Technology Group and Zhejiang Chint Electrics, disclosed in stock market filings plans to buy back their own shares. Others have announced their intention to increase their holdings.

“This series of market fluctuations is short-lived, mainly due to foreign factors, which cannot really reflect China’s economic fundamentals,” said Sui Li, secretary of the board of directors of Guangzhou Automobile Group, quoted by the newspaper.

  • Reuters, with additional editing by George Russell

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george russell

George Russell is a Hong Kong-based freelance writer and editor who has lived in Asia since 1996. His work has appeared in the Financial Times, Wall Street Journal, Bloomberg, New York Post, Variety, Forbes, and South China Morning Post. . .

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