SHANGHAI, CHINA - China's securities regulator said it was concerned about the plunge of Chinese stock prices and would work to stabilise the market.
"We are paying close attention to the fluctuations in the market," a spokesman for the China Securities Regulatory Commission said in a statement carried on the front pages of major business newspapers on Saturday.
The benchmark Shanghai Composite Index <.SSEC> hit a 19-month closing low on Thursday and is down 60 percent from last October's record peak, dragged down by high inflation, slowing corporate profit growth and heavy supplies of fresh equity.
Regulators have issued periodic statements this year pledging to help stabilise the market. It was not clear if the measures outlined in the latest statement would have an impact.
The commission said it would tighten supervision of sales of shares made tradable by the expiry of lock-up periods related to initial public offers and the reforms of state shareholding structures. Tens of billions of dollars of such shares will become tradable this year and next, pressuring the market.
Restrictions on large-lot sales of the shares will be enforced with a new monitoring system, and the commission will seek to limit the impact of disposals via the use of instruments including exchangeable bonds, it said without elaborating.
The commission said it would pay close attention to supply and demand when approving new issues of shares, and pledged to promote more long-term investment in the market by institutions such as foreign funds and Chinese insurers and pension funds.
Procedures for companies to buy back their own shares would be streamlined, and regulations would be improved to encourage firms to pay dividends. The commission added that it would crack down further on abuses such as insider trading and inaccurate valuation of assets during corporate restructurings.