Downwards pressure on China’s stocks may resume after the ongoing parliamentary meeting concludes, as state buying is set to taper off now that the key benchmark has scaled a psychologically important level, to allow market forces to operate freely, analysts say.
The national team, a term that refers to state-backed buyers, will probably slow its pace of purchases after the Shanghai Composite Index holds up above the 3,000-mark, with no surprises at the annual legislative National People’s Congress (NPC), analysts led by Chen Shujin at Jefferies wrote in a report on Tuesday.
Saxo Markets shares a similar view, saying that state buying of index-weighted companies ignored the weakness in medium and small-capitalisation stocks, a vast majority of which were in decline.
At the annual parliamentary meeting, China set a GDP growth target of around 5 per cent for 2024, in-line with market expectations but investors were concerned about…
