China's stock exchanges have been limiting the sale of shares of hedge funds and large investors as its trade war with the United States intensifies.
Four sources who spoke with Reuters said China's Burses has put restrictions on net stock sales on hedge funds and large retail investors every day, as Beijing has stepped up support for its stock market during this huge turbulent time.
The soft limit on daily net sales by individual hedge funds and large retail investors (implemented through verbal warnings from brokers) was set at RMB 50 million ($6.83 million), two investor sources said.
See also: China raises U.S. goods tariffs to 125% as “hiking becomes a joke”
Two brokerage sources said the risk of failing to comply with the stock exchange's suspension of trading accounts.
All four sources refused to be identified because they had no right to speak with the media. Shanghai and Shenzhen Stock Exchanges did not respond to Reuters' request for comment.
China has taken a series of measures to stabilize its domestic stock market, escalating from a trade war with the U.S. president, where Donald Trump imposed a staggering 145% tariff on Chinese goods.
These moves largely blocked Chinese stocks from sales in global markets.
Beijing hit back again on Friday. Increase tariffs on U.S. imports to 125%.
“Top Brokers Looking for Stable Markets”
Central China's National Fund has vowed to increase its stock holdings, more and more listed companies are buying back shares, and China's top brokerage firms have pledged to stabilize the market amid higher tariffs and global recession risks.
Quote one of the brokerage sources: “There is understandable restrictions like this because you don't want to object to the will of the state.”
Brokerage companies have been asked to closely monitor transactions between private funds and large retail clients, according to a notice released on Thursday in the second half of the year.
The notice said that if the market falls again, the current 50 million yuan daily limit for investors' daily net sales may be further reduced.
Stocks in China and Hong Kong reversed their early declines on Friday and narrowed their losses this week.
trump card His “countdown” tariffs have been suspended in most other countries Earlier this week, but have performed stricter responsibilities.
- Jim Pollard's additional editor Reuters
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