The China 50 stock index is testing for buyer support at levels from late 2025.
CHINA 50 – Daily Chart
The CHINA 50 index is back testing support at the November lows and needs buyers to emerge in order to avoid further losses.
Chinese stock exchanges announced new measures this week to facilitate refinancing by “high-quality” listed companies for innovation or growth. The move is the latest effort to reform the country’s capital markets and promote innovation, and will help “foster world-class companies”, a statement said.
Listed companies trading below their initial public offering price will have the potential to raise funds via private share placements or convertible bonds.
Further legislation on the real world tokenization of assets has also boosted related stocks. China said that RWA businesses, which convert traditional assets like securities and real estate into digital tokens, will not trade on the mainland. But regulators will vet the offshore issuance of tokens backed by onshore assets.
A strong Chinese economy, defying the impact of US tariffs, boosted Chinese stocks to 2026 highs in mid-January. Some upbeat data had reduced previous expectations for further monetary and fiscal policy support from Beijing, which has dragged on demand for Chinese stocks. However, recent announcements suggest that further stimulus measures may be forthcoming.
China’s Ministry of Commerce held a forum with Chinese automakers this week, seeking to boost domestic demand. The Ministry of Commerce will reportedly optimize auto trade-in schemes, with existing and new policies. The measures are being implemented to boost demand for vehicles, which are likely to be key to China’s domestic consumption goals.
“Over the past five years, China’s NEV sales went from 1.3m units (2020) to 16.5m units (2025). That’s a 66% CAGR, which is unheard of in the modern history of the automotive industry… Growth like this cannot be sustained without going through some period of correction or consolidation, especially when subsidies expire, raising the cost for customers,” wrote Brian Tycango at Stansberry Research.
Further trade-in or stimulus could boost stocks after they faltered recently, as AI sentiment cools globally.
