Trying to open a stock account in China on Tuesday morning, October 8, was quite a challenge. As if suddenly, the entire country wanted to benefit from the boom registered that day in the stock market, driven by the hope of new announcements of support for the economy. You cannot speak to a Galaxy Securities advisor or China Securities brokers; At the competing Guotai and Guangfa brokerages, all lines were saturated.
In recent weeks, state agencies have increased stimulus measures. The operation began at the end of September, on the eve of the Chinese National Day holiday (Golden Week, 1Ahem to October 7), at a time when all indicators showed a struggling economy, from struggling industrial activity to high youth unemployment. On September 26, the central bank announced a reduction in its official rates, as well as a major package aimed at boosting stock markets. The State, for its part, reduced the amount of the contribution required for the purchase of apartments and mortgage rates.
Most major cities have followed suit: Guangzhou and Shenzhen have removed limits on the number of apartments a family can buy, while Shanghai has reduced the number of years households must be able to prove they have paid from three to one. their social security contributions earlier. buy.
Stock Market Frenzy
Above all, the heart of power seems to have finally woken up to the magnitude of the country’s difficulties, while President Xi Jinping had until now been reluctant to help struggling real estate developers and supply brokers. On September 26, a few days before the rest week, the political bureau of the central committee of the Chinese Communist Party, which brings together the twenty-four top members of the party-state, dedicated its monthly meeting to the economy, something unusual. at this time of year. “The fundamentals of the Chinese economy, its favorable conditions such as its large market, its strong resilience and its great potential have not changed. But at the same time, problems arose.”he pointed out. Conclusion : “We must increase the intensity of fiscal adjustments and monetary policies against this cycle. »
These words sparked hope and even a certain frenzy. Many people told themselves that they would finally have the opportunity to make some money after four years of the housing market decline, which had significantly affected their savings. In one week, Shanghai’s CSI 300 index rose 20%. Even Blackrock and Goldman Sachs have raised their buy recommendations for Chinese stocks.
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