China's securities regulator unveiled a package of measures on Friday aimed at reviving a sinking stock market, but investors said they would do little to boost confidence if the economy remains sluggish.
The China Securities Regulatory Commission (CSRC) proposed steps including cutting trading costs, supporting share buybacks and encouraging long-term investment to support a stock market (.CSI300) that has slid to nine-month lows.
The regulator said it did not know if there would be a cut in stamp duty, a measure which has been discussed recently but which the CSRC said is beyond its power, falling within the remit of the Ministry of Finance.
Other measures laid out by the CSRC include boosting the development of equity funds, studying plans to extend trading hours, and improving the attractiveness of listed companies.
China's leaders vowed in late July to reinvigorate the stock market, which has been reeling as the country's economic recovery flags and woes in the property market deepen.
The CSRC said on Friday that stablizing the stock market was a priority. "Without a relatively stable market environment, there's no basis for reviving the market and lifting sentiment," the regulator said.
Some investors said they were disappointed with the plans. Niu Chunbao, a fund manager at Wanji Asset Management, said the policies would not be enough to offset broader concern about the Chinese economy.
"The key to lifting market sentiment is to rescue the economy, and the property market is the crux," Niu said. "The market is short of confidence because investors see no concrete measures to fix the economy."
Pang Xichun, research director at Nanjing RiskHunt Investment Management Co, said the measures "will give a short-term lift to a market where investors are extremely pessimistic".
"But they won't change the market fundamentals. A bull market requires genuine policies that would boost credit expansion."
COUNTERCYCLICAL
The CSRC said it would boost the development of equity funds by speeding up the registration of index funds and broadening funds' access to derivatives, and encourage fund managers to make countercyclical investments.
Listed companies will be encouraged to buy back shares, and offer investors steady streams of dividend payouts. The CSRC will also study measures to restrict financing activities by companies and sectors whose shares trade below net asset value or initial public offering prices.
It also vowed to keep "balanced" development between the primary and secondary markets, by keeping up a "rational" pace of IPOs.
Although the market had expected China to introduce a so-called "T+0" mechanism to allow shares to be bought and sold on the same day, the CSRC did not include that among its proposals, saying it could drive speculation and harm small investors.
Currently, investors can only sell stocks on the second day of purchase in China.
