Goldman Says China's National Team Sold Stocks as Rout Deepened

(Bloomberg) -- China’s so-called national team, which Beijing calls upon in times of market turbulence, was a net seller of domestic equities last quarter, according to Goldman Sachs Group Inc.

The team net sold about 104 billion yuan ($15 billion) A shares in the three months through September, Goldman analysts including Si Fu wrote in a report, citing the bank’s estimates. The onshore stock market lost $570 billion in value in that period. Goldman said state funds may have turned net buyers again in early or mid-October.

While the small-cap ChiNext gauge slid a further 12 percent in the quarter, the Shanghai Composite Index did manage to slow its decline to just 0.9 percent. The Shanghai measure is still one of the world’s worst performing major markets of the year, slumping 28 percent since late January.

Goldman Says China's National Team Sold Stocks as Rout Deepened

China’s securities regulator assured investors on Oct. 29 that “relevant institutions” increased their positions, after five state funds were found to have sold all their holdings of equities and bonds. Their quarterly reports didn’t explain why they sold, leaving traders guessing over Beijing’s intentions to support the market.

Declines in Chinese stocks accelerated again in early October, driven by persisting concerns over the trade dispute with the U.S., a rout in tech shares and slower Chinese economic growth. The Shanghai Composite hit a four-year low on Oct. 18. Stocks listed in mainland China as well as Hong Kong experienced net outflows in the third quarter, Goldman said.

©2018 Bloomberg L.P.