State media push for equity investing

The mainland's state-run media is trying to do something the securities industry has failed to accomplish for much of the past three years: get the world's biggest population to buy more stocks.

Xinhua published at least eight articles this week advocating equity investing after similar stories appeared in the newspaper and on state-run television last month, part of what Everbright Securities says is an increased government push to bolster the market.

Authorities have also cut trading fees, made it cheaper to open new accounts and organised investor presentations by the biggest listed banks in the past two weeks.

Huang Shi got the message.

The media campaign "did influence my purchase", said Huang, 26, who works in the finance industry in the northeastern city of Harbin, after shifting more than 20,000 yuan (HK$25,100) into shares last week. "Also, our stock market had slumped for so long."

Mainland policymakers are trying to rekindle interest in stocks after the Shanghai Composite Index lost US$460 billion of market value in the three years to May, the most worldwide, and investors liquidated almost five million trading accounts. A shift towards equities may help the government reduce speculative investing in the property market and curb risks tied to lightly regulated wealth-management products, whose assets rose to a record US$2.1 trillion in the first half.

The government's promotion of shares, which follows forecasts for gains this year from brokerages including Citigroup and Morgan Stanley, may already be having an impact.