China’s regulators face a losing battle convincing global funds to invest in the nation’s stocks unless market boosting efforts are accompanied by stronger stimulus to support growth.
Officials have undertaken a flurry of measures in recent days to improve battered sentiment in the world’s second-largest stock market. They’ve urged financial institutions to snap up equities, encouraged companies to boost buybacks, and asked mutual funds to stop selling. All to little avail, with the MSCI China Index slumping a further 1.3% at the close of local markets on Friday.
"Investors have been disappointed by the lack of concrete measures to boost the economy,” said Karine Hirn, partner at East Capital Asset Management. "Without stronger measures from the government and while political tensions between China and the West continue, the market may continue trending down.”