Chinese fund houses told to limit equity sales as economic slowdown worsens - reports

Repeat tactic

Chinese authorities have reportedly warned some investment funds to avoid being net sellers of equities this week, due to the ongoing market slump being driven by the country's weak economic backdrop.

According to Bloomberg, stock exchanges have issued guidance to a number of large mutual fund houses, asking them to refrain from selling more onshore shares than they have purchased. This was a tactic used to stem a fall in local assets in times of severe economic slowdown - and China's current period of suffering was only heightened last week after it was revealed the country had entered a state of deflation. China central bank makes unexpected rate cut Meanwhile, yesterday's interest rate cut has done little to boost sentiment, though many believe the government is considering m...