China scraps stamp duty to boost stocks

Beijing will do away with the stamp duty levied on stock purchases and use government funds to buy shares to support the mainland stock market, the Financial Times reported. The government said Central Huijin, part of China’s sovereign wealth fund, will buy into listed companies including state-owned lenders Industrial and Commercial Bank of China and China Construction Bank. A-share prices have fallen 70% since last October, and previous government interventions to prop up the markets this year, including a reduction of the stamp duty in April, have had only temporary effects. The Shanghai Composite Index fell to a 22-month low of 1,896 Thursday after breaking the psychologically important 2,000 barrier earlier in the week.