Authority Says Buy
China markets is still run like a strict traditional family. After watching the markets fall on inflationary worries for a prolonged period, the authorities know that without "guidance" the markets will remain in a funk for the longest time.
The China Securities Regulatory Commission announced that all major shareholders could only sell large tranches of shares through a block trade or over the counter. And shareholders need to announce placement plans one month in advance if they want to sell more than 1 percent of a company's total stock. People expect there will be more measures to come. It is very obvious that if the first move is insufficient to restore confidence, there could very well be a stamp duties reduction in the coming future.
Market watchers said investors are still watching for blue-chip tradable shares worth 1.7 trillion yuan (HK$1.89 trillion) and 12 trillion yuan to come on to the market, this year and in 2009. During past days, it's only those small caps dumping shares that have caused panic, people will be more skeptical for larger caps' similar moves.
p/s photo: Donita Rose