China’s state-backed and commercial banks lowered their deposit interest rates on June 15, and the interest rates of market-priced deposit products such as money market funds and bank wealth management products also plunged.

The China Securities Regulatory Commission will accelerate the inclusion of firms listed on the Shanghai Stock Exchange’s Nasdaq-style Star Market in the Shanghai-Hong Kong Stock Connect mechanism. The regulator will also introduce a market maker system, an index and related tools for the Star Market, said Yi Huiman, chairman of the CSRC at the 12th Lujiazui Forum held on June 18 and 19 in Shanghai.

Shanghai is becoming an open yuan-denominated asset allocation hub, and funds for normal trade and investment can flow in and out of the city freely, Yi Gang, governor of the People's Bank of China, stated on June 18. Monetary policies will maintain reasonable and sufficient liquidity in the second half. This is projected to boost new loans by nearly CNY20 trillion (USD2.8 trillion) and increase social financing by over CNY30 trillion this year.

Yuan loans for the real economy jumped over CNY10 trillion from January to last month, up more than CNY2 trillion from the same period last year, noted Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission.

China will greatly lower the threshold for strategic investment in listed companies from foreign investors, such as cutting the requirement for investors’ total assets and shortening the shareholding lockup period for foreign investors from three years to 12 months, the Ministry of Commerce announced on June 18.

In its first major revision since 1991, the Shanghai Stock Exchange will amend its plans to compile the SSE composite index beginning July 22. This will entail removing stocks with risk warnings and including new shares into the index one year after their listing, as well as securities trading on the Star Market, the bourse announced on June 19.

The China Banking and Insurance Regulatory Commission will crack down on trust companies’ lawbreaking acts but not halt their financing-based trust businesses in a one-size-fits-all approach, the CBIRC said on June 19.

The Shanghai Stock Exchange Composite Index closed at 2,967.63 points last week, up 1.64 percent or 47.89 points during the week. The Shenzhen Stock Exchange Component Index closed at 11,668.13 points, rising 3.70 percent or 416.42 points over the five trading days. The growth enterprise index ended at 2,319.45 points, growing 5.11 percent or 112.69 points during the week.

Editor: Ben Armour