"Chinese exchanges ask big fund managers to restrict stock selling, sources say"

A Reuters exclusive, January 6:

China's main stock exchanges asked some large mutual funds to restrict stock selling at the start of the year, three sources familiar with the matter said, as authorities sought to calm markets heading into a tricky period for the world's second-largest economy.

At least four large mutual funds received calls from the Shanghai and Shenzhen stock exchanges on Dec. 31 and Jan. 2 and 3, asking them to buy more stocks than they sold each day.

 

The guidance came as Chinese stocks kicked off 2025 with deep losses on worries that incoming U.S. President Donald Trump would impose hefty tariffs on Chinese goods, heaping more pressure on an already sluggish economy.

 

Those funds could sell stocks, but if total selling values exceeded purchases, they would need to add more positions soon to fill the gap, as per guidance from the exchanges, one source said.

 

"Such guidance has a tendency to become regular," the source added, noting similar requests made around the start of last year.

 

The sources were not directly contacted by the exchanges but are aware of the discussions. They declined to be named due to the sensitivity of the matter.

 

The Shanghai and Shenzhen stock exchanges did not immediately respond to a Reuters request for comment.

 

China's blue-chip CSI 300 Index slumped 2.9% on the first trading day of 2025 -- its worst New Year start since 2016. The benchmark lost more than 5% last week....

....MUCH MORE

 

The CSI 300 index is down 6.20 (-0.16%) today, 3,768.97 last.
Possibly also of interest, December 29:

The Shanghai-Shenzhen CSI 300 Stock Index Looks Manipulated