The two meetings held by the CSRC last week mentioned the endogenous stability mechanism of the market.
On March 16, when the CSRC held an enlarged meeting to convey and study the spirit of the special meeting of the financial committee of the State Council, it said that it would give full play to the role of the endogenous stability mechanism of the market and vigorously promote the listed companies to improve the quality; On March 17, when conveying, studying and implementing the spirit of the national two sessions, the CSRC proposed to adhere to the word “stability”, further improve the endogenous stability mechanism of the capital market, promote the solution of key and sensitive issues related to capital market expectations, ecology and environment, and spare no effort to maintain the stable operation of the market.
Experts believe that giving play to the endogenous stability mechanism of the capital market will help smooth the irrational and violent fluctuations of the stock market. The key is to improve the quality of listed companies, optimize the market ecology, actively guide different types of medium and long-term institutional investors to enter the capital market, and let all kinds of investors “blossom”.
guide all kinds of investors to participate
form a “hundred flowers bloom” situation
In fact, in recent years, the regulatory authorities have been emphasizing the role of the “endogenous stability mechanism” of the capital market. The system working meeting of the CSRC in 2022 proposed that “we must adhere to deepening reform and opening up, adhere to the idea of reform to solve development problems, stabilize market expectations, and activate market development power and endogenous stability mechanism”.
The system working meeting of the CSRC in 2021 also proposed to implement the concept of “non intervention” and improve the endogenous stability mechanism of the market.
Turning to how to further improve the endogenous stability mechanism of the capital market, Yin Zhongli, a researcher at the Capital Market Research Office of the Institute of finance of the Chinese Academy of Social Sciences, said in an interview with the Securities Daily that all kinds of investors should be actively encouraged and guided to participate in the market, so as to form a situation of “flowers bloom”, so as to prevent the rapid expansion of the scale of single institutional investors in the short term and form consistent expected risks.
“The more complex an ecosystem is, the more stable it will be. Different types of investors have different views and perspectives, and only when there are differences in the market can it be stable. When a certain type of institutional investors grow rapidly and become the trend pursued by the market within a certain period of time, unstable factors will appear, and regulators should pay attention to preventing such risks.” Yin Zhongli said.
“Stabilizing the market, stabilizing expectations, preventing and resolving financial risks and providing high-quality services to the real economy are several main tasks in the capital market in 2022.” Dong Dengxin, director of the Institute of Finance and securities of Wuhan University of science and technology, suggested that in terms of stabilizing the market, listed companies should be encouraged to repurchase shares, fund companies should be encouraged to purchase fund shares, and long-term institutional investors should be encouraged to increase the allocation proportion of equity assets.
need to speed up implementation
spirit of special meeting of Finance Committee
In the special meeting of the financial committee and the relevant meeting held by the CSRC, they responded to the hot issues concerned by the current market, such as the problem of China’s stock concept, prevention and resolution of real estate market risks, platform economy and so on. Experts believe that the key lies in how to implement.
“The short-term policy end has emerged. The key issue at present is how to implement the spirit of the special meeting of the financial committee, stabilize market confidence and expectations, and ensure capital supply.” Shao Yu, Orient Securities Company Limited(600958) chief economist, said in an interview with Securities Daily.
Shao Yu believes that to solve the key and sensitive problems involving capital market expectations, ecology and environment, we should start from two aspects: first, set up a “traffic light” for capital. How to determine the disorderly expansion of capital will affect the investment direction of a large number of investors in the capital market needs to be further clarified. Secondly, in view of the problem of China concept shares, it is necessary to further clarify the overseas listing channels of enterprises and the return channels of China concept shares.
Yin Zhongli believes that there are three key problems facing us at present. First, the reform of the registration system. The reform of the whole market registration system should not be eager for success, but should be steadily promoted after evaluating the operation effects of various systems of the science and innovation board and the gem; Second, the real estate market. To a certain extent, the risk of the real estate market will directly affect the operation of the stock market. To stabilize the stock market, we should first stabilize the real estate market. The top priority is to alleviate the liquidity risk of real estate development enterprises; Third, China and the United States need to reach a cooperation agreement on cross-border regulatory audit.
“In addition, when the relevant policies of the capital market are issued, we need to give the market a stable expectation.” Yin Zhongli further said.
Dong Dengxin also holds the same view. He believes that in terms of stabilizing expectations, when the reform related to the capital market is promoted, it is necessary to make layout and arrangement in advance and release information in advance, so that the market and investors can form clear and better expectations for the institutional change. In addition, in terms of preventing and resolving systemic financial risks, the regulatory authorities need to work together and cooperate with each other to carry out macro-control. In view of the financial risks that have occurred, they need to respond and respond as soon as possible.
