New | China triples number of state-owned firms in commodity derivatives trading
China increases the number of state-owned firms allowed to trade in overseas futures, swaps and options in biggest expansion in 10 years
China has more than tripled the number of central government owned firms allowed to trade commodities derivatives overseas without regulator approval, sources said, in a move that will give the country more clout in global markets for metals, energy and agricultural products.
About 100 more large government-backed companies will be permitted to trade in international futures, swaps and options markets, according to three sources with direct knowledge of the changes. It marks the biggest expansion of the list in nearly 10 years.
"This will boost trading by Chinese companies, energy in particular, given airlines and crude producers need to do it," said the head of the futures department at a government-owned company in Beijing.
The source, who declined to be identified, said his own company had received notification of the change on Monday.
China is one of the world's biggest consumers of metals, energy and agricultural products and state-owned companies often have a high demand for hedging tools.
"This is one more step towards capital account opening and a sign they will allow more inflows and outflows across their borders," said Grace Tam, a markets strategist at JP Morgan Asset Management.