HONG KONG: China and Hong Kong stocks regained some ground on Tuesday, steadying in the wake of stronger regional markets and government-led support after a brutal selloff triggered by concerns over trade tariffs.
China’s blue-chip CSI 300 Index climbed 1.7% and the Shanghai Composite Index gained 1.6% at the close, after both slid more than 7% on Monday.
Hong Kong’s Hang Seng Index rose 1.5% after slumping 13.2% in the previous session, its steepest decline since the 1997 Asian financial crisis. The Hang Seng Tech Index added 3.8%, after plummeting 17% on Monday.
Beijing has publicly stepped up efforts to stabilise the market after US President Donald Trump imposed a 34% tariff on China last week, while China responded with 34% levies on US imports.
Sovereign fund Central Huijin Investment, dubbed the “national team”, said it has bought China-listed shares via exchange-traded funds and will continue to increase holdings to “safeguard the smooth operation of the capital market.”
ETFs known to be favoured by Huijin, including Harvest CSI 300 ETF, ChinaAMC CSI 300 ETF and E Fund SSE 50 ETF, all saw trading volumes surge after spiking to their highest in a year on Monday.
Several Chinese state holding companies have followed suit and vowed on Tuesday to increase share investments, while a slew of listed companies announced share buy-backs to support prices.
China’s financial regulator also plans to raise the upper limits for insurance funds’ investment in the stock market, as part of action taken to increase support for capital markets.
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