China Regulator Relaxes Rules on Short Selling, Margin Financing

(Bloomberg) -- China’s securities regulator and exchanges are nearly doubling the number of stocks eligible for short selling and margin financing, and scrapped a previous automatic margin call threshold.

Key Insights

• China’s stock market has been volatile in recent weeks amid rising trade tensions with the U.S. The latest move could boost equities
• Supply side reform has been a policy mantra this year, with regulators making it clear that means more companies seeking financing from the capital markets
• Loan financing was seen as one of the factors that exacerbated the country’s 2015 $5 trillion market crash

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• Draft rules were announced in January
• More planned moves to open up China’s capital markets

To contact Bloomberg News staff for this story: Lucille Liu in Beijing at xliu621@bloomberg.net

To contact the editors responsible for this story: Sam Mamudi at smamudi@bloomberg.net, Sharon Chen

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With assistance from Bloomberg