21-03-2014, 09:02 AM
In the name of liberalisation... so simple to level playing fields but why didnt they do it during the crazy bull phase?
http://www.todayonline.com/business/chin...-investors
China opens door further to foreign stock investors
PUBLISHED: MARCH 21, 4:13 AM
SHANGHAI — China has relaxed its rules to allow more foreign participation in its main stock market, in the latest step towards liberalising the financial system in the world’s second-largest economy.
Foreign investors on the Shanghai stock exchange are now allowed to invest in more products and can invest up to 30 per cent in a single company, up from 20 per cent previously.
The move, which came into effect yesterday, comes just days after the People’s Bank of China, the central bank, doubled the daily trading band of its currency and after it earlier this month provided an explicit time frame for the liberalisation of the country’s deposit rates.
The Shanghai bourse also said foreign investors would now be permitted to trade asset-backed securities and participate in the preferred share programme, which is expected to be launched soon, the exchange said.
“The move comes at a time when China’s stock market is quite weak and regulators hope to attract more foreign investment,” said Mr Zheng Weigang, a senior trader at Shanghai Securities.
But analysts were guarded in their reaction to the announcement and whether it would actually result in increased foreign investor interest in the Chinese market.
“Because of lacklustre growth of China’s economy in recent quarters, foreigners’ interest in China’s stock market is ... not that strong, and that will also limit the impact of the new rules,” said Mr Zheng.
Foreign interest in Chinese equities has also been tempered in recent years by concerns that markets are driven primarily by speculation on policy direction and stimulus spending, instead of business and economic fundamentals.
China is aiming to transform its commercial centre Shanghai into a global financial hub on par with the likes of London and Singapore by 2020, but analysts say there is still a long way to go.
Said Mr Tom Gatley, Senior Analyst at GaveKal Dragonomics in Beijing: “If you want people to take you seriously as a financial centre, then you have to allow non-Chinese people to participate in the whole range of capital instruments.”
REUTERS
http://www.todayonline.com/business/chin...-investors
China opens door further to foreign stock investors
PUBLISHED: MARCH 21, 4:13 AM
SHANGHAI — China has relaxed its rules to allow more foreign participation in its main stock market, in the latest step towards liberalising the financial system in the world’s second-largest economy.
Foreign investors on the Shanghai stock exchange are now allowed to invest in more products and can invest up to 30 per cent in a single company, up from 20 per cent previously.
The move, which came into effect yesterday, comes just days after the People’s Bank of China, the central bank, doubled the daily trading band of its currency and after it earlier this month provided an explicit time frame for the liberalisation of the country’s deposit rates.
The Shanghai bourse also said foreign investors would now be permitted to trade asset-backed securities and participate in the preferred share programme, which is expected to be launched soon, the exchange said.
“The move comes at a time when China’s stock market is quite weak and regulators hope to attract more foreign investment,” said Mr Zheng Weigang, a senior trader at Shanghai Securities.
But analysts were guarded in their reaction to the announcement and whether it would actually result in increased foreign investor interest in the Chinese market.
“Because of lacklustre growth of China’s economy in recent quarters, foreigners’ interest in China’s stock market is ... not that strong, and that will also limit the impact of the new rules,” said Mr Zheng.
Foreign interest in Chinese equities has also been tempered in recent years by concerns that markets are driven primarily by speculation on policy direction and stimulus spending, instead of business and economic fundamentals.
China is aiming to transform its commercial centre Shanghai into a global financial hub on par with the likes of London and Singapore by 2020, but analysts say there is still a long way to go.
Said Mr Tom Gatley, Senior Analyst at GaveKal Dragonomics in Beijing: “If you want people to take you seriously as a financial centre, then you have to allow non-Chinese people to participate in the whole range of capital instruments.”
REUTERS
