China halves stamp duty on stock trades to boost flagging market
China halves stamp duty on stock trading in an attempt to boost the struggling market and investor confidence amid a weakened economy and a slump in industrial profits.
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Posted 8/27/2023, 11:44:00 AM
reuters.com
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China has halved stamp duty on securities transactions and lowered margin requirements for buying stocks in an effort to boost investor confidence in the country's capital market.
Hong Kong Chief Executive John Lee has established a task force to study the possibility of reducing stamp duty on stocks in order to strengthen the local economy, as the move comes after China halved its stock stamp duty in an effort to boost investor confidence.
China has cut the stamp duty on stock trades and plans to slow the pace of initial public offerings in an effort to boost investor confidence and stimulate the capital markets.
China has cut a tax on stock trading for the first time since 2008 in an effort to restore investor confidence, but concerns about the real estate crisis and sluggish growth prospects continue to weigh on the market.
China's stamp duty and margin cuts revive confidence in the Hong Kong stock market, leading to a rally in stocks such as HKEX, Alibaba, and BYD, while China Evergrande continues to struggle.
China has announced measures to support the market, including reducing stamp duty on stock trading and approving the launch of retail funds, but the response from investors has been muted.
Hong Kong brokers and analysts are calling for a reduction in stamp duty and relaxed listing rules to revive the sluggish stock market, following a decline in turnover after the government increased the stamp duty in August 2021; they suggest that these measures would attract more investors and new listings.
Hong Kong has established a 13-member task force to review the stock market's liquidity and improve its competitiveness, including examining the listing regime, market structure, and trading mechanism; however, there was no announcement regarding a reduction in stamp duty on stock trading.
China's government implemented various measures to boost its stock market, including a cut in stamp duty and restrictions on selling shares, but the impact has been limited as the CDI 300 index closed up just 1.2% after initially opening higher, and troubled property developer Evergrande experienced an 87% drop in stock value; foreign investors are pulling their money out of China and want to see more significant policy measures from the government.