On Monday, following a late-session rally in the Shanghai Composite, it was obvious the vaunted "national team" or other state-backed buyers were in play once the beleaguered benchmark hit 2016 lows. The SHCOMP's closing low in 2016 was 2,655. Yesterday, when stocks hit that apparent line in the sand, "someone" engineered a rally.
That continued on Tuesday, with Chinese stocks rising further, buoyed by a weaker dollar following Trump's renewed attacks on Jerome Powell, cautious optimism around trade, more state buying and signs that Beijing is stepping up with more stimulus.
According to the Shanghai Securities News, major Chinese insurance companies spent"at least billions of yuan" buying up shares in the onshore market on Monday. Additionally, an "unidentified large Chinese insurer" is said to have bought billions in A-shares whenever the SCHOMP fell below 2,700 over the last three trading days.
On top of that, China’s Ministry of Finance is now "suggesting" that the China Banking and Insurance Regulatory Commission slash the risk weighting for local government bonds to zero from 20% in an effort to supercharge LGF financing. That move amounts to fiscal stimulus and I
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