China’s state fund Central Huijin Investment has made substantial purchases of blue-chip stocks worth at least $41 billion in the first quarter of the year, its quarterly report revealed. The strategic move aims to stabilize the sliding stock market and restore investor confidence amidst economic uncertainties.
Central Huijin Investment allocated a significant $41.42 billion portion of its funds to purchase exchange-traded funds (ETFs) in the first quarter. This includes Huatai-PB CSI300 ETF, E Fund CSI300 Index ETF, Harvest CSI 300 ETF, ChinaAMC CSI 300 ETF, and ChinaAMC China 50 ETF. These investments have played a crucial role in supporting the rebound of China’s CSI300 blue-chip index by approximately 14 percent from five-year lows recorded in February. Moreover, market-friendly policies and the replacement of China’s top securities regulator aided that rebound.
Expansion of investment scope
In early February, Central Huijin Investment announced an expansion of its investment scope in Chinese ETFs, signaling its commitment to bolstering the stable operation of China’s capital markets. The move came amidst concerns over the weak economic recovery and a lack of robust government stimulus measures, which had dampened investor confidence and led to the stock benchmark CSI 300 tumbling to five-year lows.
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Notable purchases and market impact
Central Huijin Investment’s purchases included 26.3 billion units of Huatai-PB CSI300 ETF in the first quarter. This amounts to roughly 87 billion yuan ($12.01 billion). The fund also bought around 73 billion yuan ($10.08 billion) of E Fund CSI300 Index ETF and 53 billion yuan ($7.32 billion) of Harvest CSI 300 ETFs.
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