CSRC’s Wu vows ‘stable market’ as A-shares rebound on concerted buying - South China Morning Post

KUALA LUMPUR, 22 JULY 2026 —

China has doubled down on efforts to stabilise the country’s US$15 trillion stock market, with its securities regulator pledging to arrest equity declines and state entities conducting concerted buying, after the unwinding of the AI trade roiled global markets and sent a benchmark of technology stocks tumbling in Shanghai.

Meanwhile, coordinated state buying was under way, as two central government-backed conglomerates said on Sunday night that they had spent about 60 billion yuan (US$8.86 billion) buying yuan-denominated stocks to stem the decline, and a slew of listed companies unveiled plans for buy-backs or increases of stock holdings.

The speedy government intervention underscored Beijing’s endorsement of the nation’s yuan-denominated onshore stock market that is now playing a critical role in aiding China’s economic transition through technological innovation and growth. The tech-centric Star Market, under the Shanghai Stock Exchange, now hosts a flurry of leading chipmakers with the potential to challenge US counterparts, such as Nvidia, in the intensifying US-China rivalry from trade to AI build-outs.

“The CSRC will adhere to coordinated measures to prevent the risks on the capital market, strengthen the regulatory oversight and promote the high-quality development to strive for the stable operation of the market,” said Wu Qing, chairman of the CSRC.

The watchdog would “unwaveringly keep a transparent, fair and open market order to let investors share the benefits of economic growth and the high-quality growth of capital market.” Wu made the comment in Beijing on Monday in the meeting with attendees, who called for more measures to guide the entry of long-term capital, promote larger dividend payouts from listed companies and regulate both quantitative trading and AI adoption, according to the CSRC statement.

China’s state buyers, commonly referred to by investors as “the national team”, mainly consist of Central Huijin, a unit of the country’s sovereign wealth fund, China Securities Finance and the National Council for Social Security Fund. The state-backed investors first intervened in 2015 to counter a meltdown that wiped US$5 trillion in value from the stock market.

Renewed national-team buying in the past few days could offer a near-term sentiment backstop if weaknesses broaden or intensify Gina Wu, Bank of America China’s CSI 300 Index closed 1.5 per cent higher on Monday, while the Star Market 50 gauge added 0.2 per cent in choppy trading and Hong Kong’s Hang Seng Index rallied 2.4 per cent.

The Star Market 50 index, on which chipmakers Semiconductor Manufacturing International Corporation and Cambricon Technologies are the top heavyweights, technically plunged into a bear market last week after a 20 per cent retreat from a record high. It had surged more than 50 per cent this year before the retreat.

“[The] Sunday statement on renewed national-team buying in the past few days could offer a near-term sentiment backstop if weaknesses broaden or intensify,” said Gina Wu, a strategist at Bank of America in Hong Kong. The rout in Chinese technology stocks moved in unison with the fast-changing dynamics of the global AI trade, in which investors realigned priorities from expansion of capital spending to sustainable returns in the sector.

The unwinding of leveraged positions in South Korea’s chip stocks and a flare-up of inflation expectations also weighed on sentiment. The move by China’s policymakers shows that Beijing intends to keep the stock market’s momentum going to absorb coming mega domestic initial public offerings (IPOs) of tech companies.

ChangXin Memory Technologies’ US$9.8 billion Shanghai flotation, which is set to be the second largest ever in China’s onshore market, is now open to public subscription, and humanoid robot maker Unitree Robotics may follow suit soon after its IPO application was approved by the Shanghai exchange.

In a statement issued late Sunday night, China Reform Holdings said that it spent more than 50 billion yuan buying mainland-listed stocks through a relending programme by the central bank, adding that it would continue to increase holdings of companies owned by the central government.

Meanwhile, China Chengtong Holdings Group said in a separate statement that it bought nearly 10 billion yuan of Chinese stocks recently via two units, and would continue to buy both stocks and exchange-traded funds tied to central government-owned enterprises and technology companies. “We are firmly positive on the prospect of China’s economy and the capital market, and will strive to maintain the stable operation of the capital market,” China Chengtong said in the statement.

China Reform and China Chengtong are both state-backed investment holding companies focusing on the management of state-owned assets, with combined total assets of at least 1.7 trillion yuan. The two entities last conducted similar stock buying in April 2025, when US President Donald Trump rolled out tariffs on most American trading partners on “Liberation Day”, causing the Chinese markets to plunge alongside global equities.

The CSI 300 rose about 30 per cent in the following 12 months after the intervention. Separately, a flurry of state shareholders also announced plans to either increase their stakes in their listed subsidiaries or buy back their shares, including Shanghai-listed China Railway Rolling Stock Corporation and Aluminum Corporation of China, according to separate exchange statements.

In addition, China Pacific Insurance said that it would boost its investments in stocks and was preparing for interim dividend issuance, while carmaker SAIC Motor said that its state parent had pledged not to reduce its stake in the next six months. “On the regulatory front, the policy signal to stabilise the market is quite clear,” said Xu Ruchun, an analyst at Founder Securities.

“Positive factors are building up to underpin a stabilisation of the market.” (AI-assisted rewrite, based on the original source)