China is set to ease its crackdown on overseas listings following months of market volatility and work with the US to reach an agreement on audit requirements.
The China Securities Regulatory Commission confirmed today that China will communicate with US regulators to usher in greater cooperation between the pair.
The government will begin to “actively introduce policies that benefit markets,” a meeting of China’s top financial policy committee led by Vice Premier Liu He, the country’s top economic official, heard today.
A state media report added that regulators should “complete as soon as possible” the clampdown on internet platform companies. “The Chinese government continues to support various kinds of businesses’ overseas listings,” the report said.
A handful of popular Chinese tech stocks plunged late last week, after the US Securities and Exchange Commission (SEC) said they could be delisted for failing to meet US audit requirements.
Fast-food company Yum China Holdings, tech firm ACM Research, biotech group BeiGene, Zai Lab, as well as pharmaceutical company Hutchmed were among those named and shamed by the US regulator.
Stocks across China and Hong Kong rocketed on Wednesday following the announcement, after a depressed start to the week as fresh Covid-19 lockdown measures dampened investor spirits.
The Hang Seng China Enterprises Index soared 13 per cent at the close in Hong Kong, the most since 2008. While the CSI 300 Index of mainland shares rose 4.3 per cent.
The new Covid-19 measures sparked global supply chain concerns and fears that prices could climb even higher.
Investment group Shard Capital explained earlier this week that “higher food prices are viewed as ‘social kryptonite’ by the Chinese authorities and they will do all they can to ensure that any impact from food price inflation is muted and temporary”.