Fund managers restrained from heavy selling after regulator tells them to support index
The China Securities Regulatory Commission on Wednesday told fund managers to support the stock market as it sought to avoid a sharp fall in the wake of the earthquake in Sichuan province, the South China Morning Post learned yesterday.
It was the regulator's second intervention in the market in just three weeks following a cut to the stamp duty to bolster the slumping market.
Three fund managers said their companies received phone calls from CSRC officials who asked for no excessive trading in shares after the 7.8 magnitude quake that struck Wenchuan county in Sichuan on Monday.
'They didn't give a flat-out order [not to sell shares], but it was apparent that the regulator was requiring the funds not to dump shares at that critical moment,' said a Shanghai-based fund manager. 'If the officials keep doing so, we won't be able to do our job.'
The benchmark Shanghai Composite Index rose 2.73 per cent on Wednesday following a 1.84 per cent fall a day earlier as a buying spree surrounded commodities producers who are believed will be beneficiaries of the potentially enormous reconstruction efforts.
The index dipped 20.11 points or 0.55 per cent to 3,637.324 yesterday.
