Business
Unprecedented Rescue Package Sparks Potential China Stock Rally: Wall Street Banks Applaud Beijing’s Bold Market Stabilisation Measures
Wall Street banks predict an 'entirely optimistic' bailout package could spark a major surge in Chinese stock market. This unique approach emphasizes Beijing's resolve to steady the market and enhance trust among investors, according to specialists.
"Laura Wang, an equity strategist at Morgan Stanley, expressed enthusiasm on Tuesday, viewing the declared actions as an entirely optimistic step due to their unparalleled characteristics and the pledge of limitless financial support."
Unanticipated market assistance steps from the People's Bank of China should bolster investor confidence and liquidity, encouraging both domestic and international markets to respond optimistically in the immediate future.
On Tuesday, the People's Bank of China announced that insurance firms, asset management companies, and securities agencies are allowed to utilize bonds, equity exchange-traded funds, and single stock holdings of CSI 300 members as collateral. This collateral can be swapped with the central bank's treasury bonds and bills, amounting to as much as 500 billion yuan, for investment in the stock market.
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