Beijing – China on Wednesday will direct major state-owned insurance companies and commercial insurance funds to increase investment in the A-share market, the latest step to boost a sluggish stock market.
Under a plan issued jointly by six financial regulators including the securities regulator, major state-owned insurance companies will be directed to increase both the size and proportion of their investments in China’s listed sovereign wealth funds and equities.
Regulators will use a long-term performance test for public insurance companies, with an annual return on equity not exceeding 30% of the test, and at least 60% for a long cycle of three to five years.
The plan comes as Chinese stocks began 2025 with deep losses on concerns that US President Donald Trump will impose heavy tariffs on Chinese goods, putting further pressure on an already faltering economy.
The program will increase the investment of China’s National Social Security Fund and pension funds in the stock market.
It will also direct mutual fund managers to gradually increase both the size and proportion of mutual funds under their management.
China has introduced a number of measures to boost investor confidence and revitalize its stock market. Among measures to support financial markets in the past few months, the authorities have implemented exchange programs and released up to 800 billion yuan of stock buybacks.
