Latest News

China securities regulator looks for to reduce market panic over delisting threats

China's securities guard dog does not anticipate a nearterm spike in delistings, it said on Thursday, after financiers discarded shares in smallcap companies on worries they might be kicked off the market as Beijing weeds out weaker companies.

The survival of the fittest system is slowly taking shape however in the short term, there will not be an apparent. increase in the number of delisted companies, the China. Securities Regulatory Commission (CSRC) said in a declaration.

Lots of investors say the risk of buying shares in smaller. business is increasing, while brokerages have actually anticipated a record. number of delistings this year.

Niu Chunbao, fund supervisor at Wanji Possession Management stated. that under the existing regulatory framework, the method of. ' stirfying' or going after hot small-cap stocks, no long works,. rather recommending blue-chips.

China's small-cap CSI2000 Index has fallen 9%. today, bringing a year-to-date decline to 23%. On the other hand,. the bluechip CSI300 Index has increased 5% so far this. year.


Under brand-new chairman Wu Qing, the CSRC has pledged to regulate. with teeth and thorns to restore confidence in the stock. market.

Regulators raised the bar for company listings and moved to. weed out zombie companies and black sheep in a raft of. reform measures released in April.

Nearly 100 China-listed companies have actually been tagged ST. ( special treatment) this year to flag delisting or other threats,. bringing the total number to 169, the CSRC stated on Thursday.

But in an obvious attempt to relieve investor anxiety, the. watchdog said the number does not represent a dive from previous. years, and the ST label can be eliminated if a company's. basics improve.

An index tracking ST stocks has tumbled more than 50% this. year, with gold miner YanTai Yuancheng sliding 96%. on Thursday alone.

Zhang Kexing, general manager of Beijing Gelei Property. Management, stated lots of little business deal with unpredictability, so he. now just chooses leading market gamers that can let investors. sleep soundly in the evening.

As just recently as a year back, investors were snapping up. small-caps, which had surpassed blue-chips throughout the. financial wobble of previous years.

Lu Deyong, a retail financier who states he made a handsome. earnings banking on small-caps in the past, is now altering tack.

Those small-caps with poor fundamentals deal with the danger of. being rejected, said Wu, who is welcoming blue-chips such as. PetroChina and Kweichou Moutai.