China Plans Billions to Boost Stock Investments from Insurers

In a bid to stabilize its equity markets amid ongoing economic challenges, China is directing state-owned mutual funds and insurers to increase their investments in stocks significantly. The China Securities Regulatory Commission's chairman, Wu Qing, announced that mutual funds should raise their onshore equity holdings by at least 10% annually over the next three years, while large insurers must allocate 30% of new policy premiums to stock investments starting in 2025. A pilot program will launch in the first half of this year, channeling at least 100 billion yuan ($13.75 billion) into long-term equity investments. Following the announcement, major stock indices such as the CSI 300 and the Hang Seng saw gains, indicating a positive market reaction. Analysts suggest that these measures are crucial for creating a more stable trading environment, although further fiscal stimulus may still be necessary for a substantial market recovery. The initiative reflects a broader strategy to draw long-term capital into the market as the economy faces deflationary pressures and geopolitical tensions.