China lifts quota for foreign investment in sharesAssociated Press . Shanghai
China has raised its quota for stock investments by foreign institutional investors, in a step toward easing controls on its tightly regulated domestic share markets.
The China Securities Regulatory Commission announced Thursday that it was more than doubling the current quota, by $50 billion, to $80 billion.
Regulators have struggled to stir up interest among investors in the local currency denominated, or ‘A-share’ market, which has languished for years after hitting a peak in 2007.
The qualified foreign institutional investors program is the only legal way for foreign investors to buy shares in the mainstream yuan-denominated market.
The regulator said the decision to increase the quota is meant to ‘promote opening of the domestic stock market, expand overseas investment channels for the yuan and to meet the needs of foreign investors on the domestic stock market.’
The news buoyed Chinese shares, with the benchmark Shanghai Composite Index jumping 1.7 per cent to 2,302.24.
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