China’s regulators rush to rally market confidence

China should cancel a stamp tax to lower trading costs and drive the sound growth of the domestic capital market, a Chinese legislation official said over the weekend.

Huang Qifan, vice chairman of the National People’s Congress Financial and Economic Affairs Committee, told a forum that China should cancel the tax stamp to encourage capital markets to enhance vitality, domestic news site finance. qq.com reported.

China’s regulators lined up to rally market confidence on Friday with new rules, measures and words of comfort as shares brushed near four-year lows for the second straight day before surging.

Vice Premier Liu He, who oversees the economy and the financial sector, supplemented regulators’ moves by saying the recent stock market slump “provides good investment opportunity” and that economic problems should be treated rationally.

Earlier in the day, the securities regulator, the central bank, and the banking and insurance regulator all pledged steps to bolster market sentiment as China reported its weakest pace of economic growth since the global financial crisis for the third quarter.

While authorities in the world’s second biggest economy have been slowly easing monetary conditions, Friday’s announcements were largely aimed at building a floor under the tumbling stock market.

Beyond building a floor, the moves also fueled a rally. Chinese stocks closed higher on Friday, with the benchmark Shanghai Composite Index up 2.58 percent, at 2,550.47 points.

The Shenzhen Component Index closed 2.79 percent higher at 7,387.74 points.

The ChiNext Index, China’s NASDAQ-style board of growth enterprises, gained 3.72 percent to close at 1,249.89 points on Friday.

Even with that, the Shanghai index is still down close to 10 percent this month and nearly 25 percent since late January as foreign investors and domestic institutions dumped shares amid concerns about rising US Treasury yields and escalating trade tensions with the US.