China appoints ‘Broker Butcher’ Wu Qing as new chairman of securities regulator

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BEIJNG, CHINA – NOVEMBER 13: Illuminated skyscrapers stand at the central business district at sunset on November 13, 2023 in Beijing, China. (Photo by Gao Zehong/VCG via Getty Images)

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China’s Cabinet on Wednesday appointed market veteran Wu Qing as chairman of the China Securities Regulatory Commission, state media Xinhua said, replacing Yi Huiman to navigate Beijing through the turbulent waters of a market downturn.

Dubbed the “Broker Butcher” for his crackdown on traders, Wu previously served as acting vice mayor of China’s financial center Shanghai and served nearly two years as chairman of the Shanghai Stock Exchange. .

His predecessor, Yi, assumed the mantle of the CSRC in 2019, tasked with a number of capital markets reforms.

Wu’s appointment comes on the heels of the CSRC over the past two weeks announcing new supportive policies to stabilize and revive China’s troubled stock market, which has become a hotbed of instability. the property sector and widespread investor pessimism about the outlook for the second world sector. largest economy.

The measures came as the CSRC earlier this week pledged a spartan new “zero tolerance” policy against malicious short selling – promising that a particular asset or assets will fall in price – warning criminals which could mean “they’ll lose their shirts and rot in jail. “, according to Reuters.

“The CSRC will stop the use of securities lending transactions to implement improper arbitrage and other illegal activities in accordance with the law to ensure the smooth operation of the securities lending business,” a CSRC spokesperson said on February 6. , according to Google. – report translated.

Worsening the picture, China’s CSI 300 fell to a five-year low on January 31, after the country’s manufacturing activity contracted for the fourth consecutive month. Citing undisclosed sources, Bloomberg News reported that Chinese President Xi Jinping will discuss the state of the stock market with financial regulators, following a speech last month that ‘ praise the merits of “high-quality financial development,” the “combination of the stock rule.” law and influence management,” and implementing a “financial culture with Chinese characteristics.”

In late January, Chinese Premier Li Qiang called for “stronger and more effective measures to stabilize the market and confidence,” according to a statement translated by Google, raising expectations that Beijing will move to so far reluctant big incentive package, among increases. fears that inflation will enter growth after China’s economy underwent a slower-than-expected post-Covid-19 recovery.

UOB Kay Hian discusses the outlook for China's stock markets
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