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economic observer network reporter cai yuekun after the political bureau meeting of the cpc central committee (hereinafter referred to as the "political bureau meeting") was held on september 26, the confidence of a-share investors was once again encouraged.

the meeting clearly emphasized that efforts should be made to boost the capital market, vigorously guide medium and long-term funds to enter the market, and open up the blocking points for social security, insurance, financial management and other funds to enter the market; support mergers and acquisitions and reorganizations of listed companies, steadily promote the reform of public funds, and study and introduce policies to protect small and medium-sized investors measure.

this is after the financial regulatory authorities launched a "combination punch" to support the economy and capital market (hereinafter referred to as the "september 24" new deal) at the press conference of the state council information office on september 24. high-level officials once again clearly stated this from the policy level. revitalize the capital market.

the market started to surge in the afternoon.

on september 26, the three major a-share indexes collectively rose sharply. as of the close, the shanghai stock exchange index regained the 3,000-point mark, rising 3.61%, the shenzhen component index rose 4.44%, the chinext index rose 4.42%, the bse 50 index rose 2.97%, and the market turnover was 1.1664 billion yuan. more than 5,100 stocks rose in the two cities. consumption, real estate, and financial sectors all rose.

before this meeting, the strength of the "9·24" new deal had clearly exceeded market expectations, and multiple major policy benefits continued to ferment, and the sentiment of the capital market was quickly ignited. a-shares staged a "big reversal" and started a rapid rise. in the past three trading days, the shanghai stock exchange index has risen by more than 9%.

wind data shows that judging from wind’s all-a growth rankings in the past five years, the shanghai stock exchange index has risen by more than 4% only 4 times, namely on july 6, 2020, february 6, 2024, september 24, 2024 and september 26th.

on the evening of september 26, the central financial office and the china securities regulatory commission jointly issued the "guiding opinions on promoting the entry of medium and long-term funds into the market", which focused on building and cultivating a capital market ecosystem that encourages long-term investment, vigorously developing equity public funds, and striving to improve various three-pronged measures include supporting policies and systems for medium- and long-term funds to enter the market.

chen guo, chief strategy officer of citic securities, issued a statement saying that the meeting's signal of making every effort to revitalize the economy is very strong, and also specifically mentioned efforts to boost the capital market, which is encouraging and will be a double benefit to the stock market in terms of profitability and valuation. a-shares and hong kong stocks the trend is expected to reach a higher level.

rekindleinvestorenthusiasm

a rare series of major moves by policymakers to support the economy and capital markets have reignited the enthusiasm of stock market funds.

"caught another 20% daily limit."

"you performed well today, let's continue tomorrow!"

good market conditions bring good mood. on the interactive platform of financial websites, investors have shown off their profits one by one.

in terms of sectors, liquor stocks are venting wildly. penghua csi liquor etf (512690) has reached its daily limit for the first time in history. almost all stocks in the sector have reached their daily limit. kweichow moutai (600519.sh) has risen by 9%, and its turnover has exceeded 10 billion for three consecutive days. real estate stocks set off a trend of daily limit rises. vanke a (000002.sz) and poly development (600048.sh) rarely reached their daily limit simultaneously, and more than 30 stocks in the sector exceeded their daily limit.

big finance continued its strong firepower. tianfeng securities (601162.sh), changjiang securities (000783.sz), and guohai securities (000750.sz) rose by the limit, while citic securities (600030.sh) and ping an of china (601318.sh) rose more than 6%.

in addition, oriental fortune (300059.sz), flush (300033.sz), and aier ophthalmology (300015.sz) rose by more than 10%.

an investor in beijing told economic observer that in 2018, he bought a house in the east third ring road in beijing for his wedding. recently, because he could not bear the high 4.5% existing mortgage interest rate, he decided to use the money on hand to pay off part of the mortgage in advance. but as soon as the meeting on september 24 ended, he gave up the plan to repay the loan in advance, "i transferred the money to the bank and prepared to increase my position in some stocks."

on september 26, economist ma guangyuan posted on his public account that the long-term downturn in the stock market has seriously affected people’s expectations and confidence in the economy. the stock market has rebounded strongly in recent days. on the one hand, it is because it has fallen too much and has almost fallen out of the investment pit; on the other hand, it is related to the policies that have been introduced recently to stabilize the stock market. ma guangyuan mentioned that for the stock market, the right time and place are favorable, the index is low, the policies are good, and the economic policies are strong. there is a high probability that there will be a bull market.

financial institutions also made optimistic judgments about the stock market. manulife fund said that since the beginning of this year, the stock market as a whole has faced certain pressures, and market trading volume has also declined to a certain extent. there is a certain lack of incremental funds and a game of the overall market stock. rrr cuts, interest rate cuts and the introduction of structural policies will provide more sufficient liquidity support for the market, help alleviate funding pressure and stabilize market confidence. the market's demand for long-term stable low-cost liquidity still exists, and the coordination role between monetary policy tools has become increasingly obvious. coupled with the recent unexpected interest rate cuts by major overseas economies, global liquidity has also ushered in a phased improvement.

a “stimulant” for the market

after the "9·24" new deal official announced the "combination boxing" policy, the politburo meetings continued to actively express their positions, further boosting the confidence of a-share investors.

china galaxy securities stated that the politburo meeting in july 2023 mentioned "activating the capital market" and the politburo meeting in april 2024 mentioned "taking multiple measures to promote the healthy development of the capital market", and this politburo meeting "strives to improve "revitalize the capital market" has become more proactive.

wang qing, chief macro analyst of oriental jincheng, believes that this politburo meeting was held on september 26, which is different from previous practices. it shows that at this point in time, the work of stabilizing growth is highly valued; and the important deployments made at the meeting, in particular, the arrangements for real estate work have exceeded general expectations and will play an important role in unifying thinking, guiding expectations, and boosting confidence.

on the morning of september 24, pan gongsheng, governor of the people's bank of china, li yunze, director of the state financial supervision and administration bureau, and wu qing, chairman of the china securities regulatory commission, respectively made a major statement at a press conference held by the state council information office. a-shares are ushering in a reduction in existing mortgage interest rates. , further lowering reserve requirements, vigorously developing equity funds, and arrangements for medium and long-term capital entry into the market, etc. a series of favorable policies.

this is the first time that the central bank has used such a large-scale targeted approach to bring vitality to the capital market. not only that, in response to reporters’ questions about the creation of the stabilization fund, pan gongsheng said it was “under study.” this brings another "boost in the arm" to the market.

after the central bank rarely launched a powerful combination of punches to boost the stock market, the a-share market ushered in a long-awaited boil. on september 24, the shanghai composite index returned to 2,800 points, with an increase of 4.15%, the largest single-day increase in more than four years.

on the evening of september 24, the china securities regulatory commission studied and formulated the "opinions on deepening the market reform of mergers, acquisitions and reorganizations of listed companies." at the same time, the china securities regulatory commission publicly solicited opinions on the "decision on amending the measures for the administration of major asset restructuring of listed companies (draft for comment)". the china securities regulatory commission has also studied and drafted the "guidelines for the supervision of listed companies no. 10 - market value management (draft for comments)" (hereinafter referred to as the "guidelines") and publicly solicited opinions from the public. the "guidelines" require listed companies to improve operating efficiency and profitability based on improving the quality of listed companies, and use mergers and acquisitions, equity incentives, cash dividends, investor relations management, information disclosure, share repurchases, etc. in accordance with the actual situation and in compliance with laws and regulations. method to promote the improvement of the investment value of listed companies.

wang zonghao, head of china equity strategy research at ubs, believes that although the impact on the real economy may take time to emerge, these measures will be more beneficial to the stock market. the most important measures include improving the quality of listed companies and establishing credit facilities to provide incremental liquidity for the stock market. nature, provide funds to support companies to repurchase shares and study the establishment of stabilization funds. he believes that a series of measures should be able to bottom out market sentiment in the short term. follow-up documentation and the cost of financing the credit facility may be the next focus for investors.

"niu hui, come back quickly!"

since the beginning of this year, the performance of the a-share market has left investors with mixed feelings.

since 2022, the shanghai composite index has begun to fluctuate downward. especially entering 2024, the shanghai composite index has continued to fall from a position of nearly 3,000 points. it has continued to dive since the end of january, and once fell below 2,700 points in early february. the market is extremely depressed.

on february 7, wu qing left his post as deputy secretary of the shanghai municipal party committee to serve at the china securities regulatory commission and became the tenth chairman of the china securities regulatory commission.

after wu qing took office, investors had high expectations for the new head of the china securities regulatory commission. the a-share market is experiencing a rebound. since then, the china securities regulatory commission has successively introduced a series of new policies on ipos (initial public offerings), dividends, refinancing, delisting and strict supervision of listed companies and intermediaries, etc., continuously reforming and improving the institutional structure of the capital market.

with the support of continued favorable policies and the entry of long-term funds into the market, the shanghai stock exchange index rose from 2,700 points in early february to a peak of nearly 3,200 points on may 20 after more than three months.

however, due to various reasons such as lower asset prices in china, the a-share market has been shrinking and declining. on september 13, the shanghai composite index fell to around 2,700 points again. market sentiment fell to freezing point.

investors are struggling in a depressed market. some investors said that they were even unwilling to open a stock account because of the huge losses.

on september 24, the unexpected "combination punch" targeted the capital market with vigorous stimulus policies, opening the door to the "reversal" of a shares. market sentiment was quickly activated.

the politburo meeting on september 26 gave the capital market a shot in the arm. the shanghai composite index hit 3,000 points in one fell swoop. investors shouted "niu hui, come back quickly!"

as of september 26, wu qing has been the head of the china securities regulatory commission for more than 200 days. over the past 200 days, the capital market has experienced ups and downs, but what remains unchanged is that the wheel of reform is moving forward, and investors are banking on the sense of gain from stock investment.

cicc believes that the "1+n" policy system of the capital market is expected to continue to improve in the future. the china securities regulatory commission stated that it will soon issue the "guiding opinions on promoting medium and long-term funds to enter the market" to promote the establishment of a market-oriented incentive and restraint mechanism for share repurchases of listed companies. . the issuance of relevant institutional rules in the future will help further improve the basic institutional system of the capital market, promote the role of market functions, and help promote the high-quality development of the capital market.

looking forward, manulife fund believes that the current domestic macroeconomic fundamentals are still under great pressure, and major indicators such as investment and consumption have all faced downward revision pressure since the beginning of the year. this policy is of great intensity and the signal is of great significance. after the monetary policy turns, we can still expect follow-up policies related to finance, consumption, and real estate to stimulate domestic demand and stabilize economic growth.

wang zonghao believes that the “9·24” new deal brought surprises to the market because investors’ expectations were low. these measures also support ubs's view on value-enhancing initiatives and roe (return on equity) improvement. ubs believes this will contribute to long-term, sustainable returns in the chinese stock market.

cicc said that judging from the performance of the a-share market, after experiencing a volatile correction in late may, boosted by a package of policies to stabilize growth, stabilize markets and stabilize expectations, a-share market sentiment rebounded significantly. the market performance may have twists and turns after the short-term surge, but the rebound is still expected to continue. positive policies have helped to increase investor confidence. currently, a-shares also show obvious bottom-biased characteristics in terms of technical indicators such as trading volume, turnover rate, funding, and valuation.