China’s state financial institutions have spent around US$144 billion to support the mainland’s stock market since June, less than half of the US$322 billion believed to be at their disposal, The Financial Times reported, citing estimates from Goldman Sachs. “The episode has underlined the difficulty the government faces in the task it has set itself of convincing investors that equity markets will deliver sustained gains,” said Chang Liu at Capital Economics. “The market is driven more than ever by speculation about official intentions and any positive momentum will raise questions about whether support will be withdrawn.”
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