CSRC chairman vows to stabilise stock market
In a comment apparently aimed at propping up the anaemic stock market, China Securities Regulatory Commission chairman Shang Fulin said the regulator would help stabilise volatility, adjust the pace of financing and clamp down on market rumours.
During an internal meeting held yesterday, Mr Shang said investor confidence had been weakened by the increased volatility of the stock market amid global financial turmoil, new government policies and economic problems, according to Xinhua.
'The next task [for the CSRC] is to fully support the stable operation of the market ... reasonably balance supply and demand, pace fund-raising activities in an orderly way, including issuing regular reports on previously locked-up shares, and encourage long-term funds to invest,' Mr Shang was quoted as saying.
Hit by concern over government tightening measures to curb inflation, the Shanghai Composite Index has lost 46 per cent this year, making it one of the worst performing markets in the world.
People's Bank of China governor Zhou Xiaochuan on Friday signalled a tougher fight against inflation after fuel price increases, sparking speculation of higher interest rates.
Volatility was also heightened by on-and-off rumours and speculation of rescue measures by Beijing to bolster trade on the market, including the launch of index futures and margin trading.
The index climbed 5.24 per cent last Wednesday, but the gain was wiped out by a 6.54 per cent loss the following day.
Mr Shang said that as the market entered a period of adjustment, rumours regarding the capital market had also emerged with a few people spreading inaccurate information.
The CSRC would adopt measures to deal severely with those who engaged in illegal activities such as spreading malicious rumours, he said.
The regulator would also strengthen supervision with a focus on new issues and situations concerning illegal activities, he said.
In co-operation with the judicial department, the CSRC would improve investigations and enforcement in the brokerage industry and would harshly punish market manipulators, breaches of disclosure and fund misappropriations at listed companies, Mr Shang said.
However, in the long run the healthy fundamentals of the capital market and its development path would remain unchanged, he said.
Mr Shang said the regulator would also study ways to help reconstruction in areas affected by last month's earthquake in Sichuan province. It would support listed companies and brokerages affected by the natural disaster to rebuild and ensure an orderly market there.
