China's Stock Market Revival Strategy: Boosting Investments

The Chinese government aims to boost domestic stock markets by ordering pensions and mutual funds to significantly increase their investment in domestic shares. This strategic move is expected to infuse hundreds of billions of yuan into the market over the next three years.

In a strategic move to invigorate sluggish markets, the Chinese government has mandated an increase in investments in domestic stocks by pensions and mutual funds. This directive aims to stimulate market growth by directing substantial funds into the domestic 'A-share' market.

Officials announced the plan on Thursday, requiring mutual funds to expand their onshore stock holdings by at least 10 percent annually over the coming three years. Simultaneously, commercial insurance funds will be obligated to allocate 30 percent of their annual new premium revenues into share markets starting this year.

The head of China's securities regulatory commission highlighted that this initiative could add hundreds of billions of yuan in long-term funds, a move that has already positively affected market indices in Hong Kong and Shanghai.

(With inputs from agencies.)