China to further open up capital market

China is considering launching a new round of capital market opening-up measures while seeking closer international cooperation in supervising overseas-listed Chinese companies, the head of the country's top securities regulator said on Monday.

"We will provide more equitable, efficient and convenient services for overseas institutions and investors to participate in China's capital market," said Yi Huiman, chairman of the China Securities Regulatory Commission.

Yi said the CSRC is working on measures to increase the securities that are eligible for connect programs between mainland and Hong Kong exchanges, expand and improve the Shanghai-London Stock Connect, make more commodity and financial futures products available to foreign investors, and facilitate the recognition of international practitioners' qualifications.

The commission is also striving for greater progress in international regulatory cooperation regarding the supervision of overseas-listed Chinese companies, cross-border audit oversight and the enforcement of laws and regulations, Yi said.

Global financial hubs "should not become platforms and tools for governments to suppress and sanction other countries", Yi said, adding that any "zero-sum game" mindset should be forgone, as global financial communities have become intertwined with common interests.

Yi made the remarks via video link at the opening of the 60th World Federation of Exchanges General Assembly & Annual Meeting, during which leaders from 91 global securities and futures exchanges and clearing institutions will discuss major issues of the industry. The meeting, hosted by the Shenzhen Stock Exchange, will last through Thursday.

His remarks also came amid a dispute between China and the United States surrounding the oversight of audit work for US-listed Chinese companies, as well as China's continuous reform and opening-up of the capital market.

President Xi Jinping announced on Thursday that China will set up a stock exchange in Beijing and build it into a major base for serving innovative small and medium-sized enterprises.

Meanwhile, the Hong Kong exchange will launch its first A-share index futures product on Oct 18, providing a new risk management tool for global investors trading in A shares.

The commission will take the new exchange's launch as a chance to build a comprehensive set of arrangements to support SMEs, Yi said.

He added that the CSRC will remain vigilant against any risks of asset bubbles created by the circulation of liquidity within the financial system diverting funds from the real economy.

Wang Jianjun, chairman of the Shenzhen Stock Exchange, said at the meeting that the registration-based public offering reform that took effect last year on ChiNext, a Shenzhen board heavy with growth enterprises, has encouraged innovative enterprises to get listed and has funneled more resources into technological innovation.

More than 180 enterprises have floated shares on ChiNext since the reform took effect, up from 52 in all of 2019, Wang said.

The exchange has also pressed ahead with high-level opening-up, having signed memorandums of understanding with 52 global exchanges and market institutions, he added.

Meng Lei, an A-share strategist at UBS Securities, said the recent policy signals of capital market opening-up have reassured global investors after market fluctuations.

China's A-share market ended in an upbeat note on Monday, with the benchmark Shanghai Composite Index up 1.12 percent to 3,621.86 points, the highest closing level in three months.