Stock market rescue progress; "Open" AI with Chinese characteristics?; PRC-Philippines trade accusations as Wang Yi arrives for ASEAN; EU-China discussions
Today’s top items:
1. Stock market rescue progress - The government intervention to prop up stock prices worked Tuesday. The Shanghai Composite closed up 1.8% at 3,864.37, the Shenzhen Component up 4.8% at 14,264.29, while the ChiNext and STAR Market indexes jumped 7.1% and 8.8% to 3,685.97 and 2,060.48.
Members of the Party Group of the China Securities Regulatory Commission (CSRC) held another symposium Tuesday “to solicit opinions and suggestions from various parties on promoting the stable and healthy development of the capital market”. According to the CSRC readout, translated here, “twenty-nine representatives from listed companies, securities and fund institutions, and the ranks of experts and scholars took part”. Quant funds should expect more regulation:
In the discussions, participants said that China’s economy is currently showing a development trend of overall stability and movement toward the new and the better. Since the release of the new “Nine Measures,” the overall ecology of the capital market has undergone profound changes, the effects of the comprehensive reform of investment and financing have continued to be released, the quality and investment value of listed companies have been effectively raised, and there is a solid foundation for keeping the market running steadily. Participants offered opinions and suggestions on such matters as further strengthening the capital market’s foundational institutional framework, implementing a long-cycle assessment mechanism for medium- and long-term funds, continuously improving the standardized operation and governance of listed companies, further regulating quantitative trading behavior, intensifying the punishment of market violations and irregularities, strengthening the guidance of capital-market expectations, and further institutionalizing mechanisms for market stabilization.
座谈中，大家表示，当前我国经济呈现总体平稳、向新向优的发展态势，新“国九条”发布以来，资本市场整体生态发生深刻变化，投融资综合改革效应持续释放，上市公司质量和投资价值有效提升，保持市场稳健运行具备坚实基础。与会代表围绕进一步加强资本市场基础制度建设、落实中长期资金长周期考核机制、不断提升上市公司规范运作和治理水平、进一步规范量化交易行为、加大市场违法违规惩处力度、强化资本市场预期引导、进一步推动稳市机制制度化等方面提出了意见建议。
“Strengthening the guidance of capital-market expectations” likely means more positive talk about market prospects, and “further institutionalizing mechanisms for market stabilization” sounds like a call for more “national team” support, SOE buybacks, and long-term institutional money, in a more institutionalized way.
According to the readout, the “responsible official” from the CSRC said:
At the meeting, the responsible official of the CSRC said that high-quality development of the capital market cannot be achieved without the joint participation and joint efforts of all parties, including listed companies, industry institutions, and experts and scholars. He expressed the hope that listed companies would work to strengthen their compliant-operation capabilities and enhance their core competitiveness so as to better reward investors; that industry institutions would step up counter-cyclical positioning and earnestly raise the level of their investor services; and that experts and scholars would actively offer advice and proposals and speak out rationally, so as to jointly foster a sound market environment. The CSRC will conscientiously study and absorb the opinions and suggestions raised by all parties, proactively respond to market concerns, take a coordinated approach to preventing risks, strengthening regulation, and promoting high-quality development, continue to strengthen the market’s foundational institutional framework, enhance the market’s inherent stability, improve the long-term mechanism for protecting investors’ lawful rights and interests, and better promote the long-term, steady, and healthy development of the capital market.
会上，证监会负责同志表示，资本市场高质量发展，离不开上市公司、行业机构、专家学者等各方面的共同参与、共同努力。希望上市公司着力增强合规经营能力、提升核心竞争力，更好回报投资者；行业机构加大逆周期布局力度，切实提升投资者服务水平；专家学者积极建言献策、理性发声，共同营造良好市场环境。证监会将认真研究吸收各方面提出的意见建议，主动回应市场关切，统筹防风险、强监管、促高质量发展，持续加强市场基础制度建设，增强市场内在稳定性，完善投资者合法权益保护长效机制，更好推动资本市场长期平稳健康发展。
“Industry institutions would step up counter-cyclical positioning and earnestly raise the level of their investor services; and that experts and scholars would actively offer advice and proposals and speak out rationally, so as to jointly foster a sound market environment” sounds like an instruction to not sell into weakness while ensuring commentary and analysis about the market are positive.
The monster CXMT IPO is imminent, and they need it to go off well. Even more importantly, regulators need investors to keep putting money into the market to fund the national technology strategy.
2. PRC to soon restrict open model weights? - So says the Financial Times, which reports that:
Regulators led by the Ministry of Commerce (MofCom) have been consulting leading domestic AI and chipmaking groups on how to prevent China’s advanced technologies and star start-ups from being acquired by the west, according to two people involved in the discussions.
MofCom talked to AI companies including Alibaba, ByteDance and Zhipu on limiting the transfer of key data for the training of their models overseas, as well as allowing their model weights to be downloaded by foreign users, the people said. China would still let overseas customers access the models and services, however...
That follows recent reporting from the Wall Street Journal and Reuters, and should not be a surprise.
On this week’s Sharp China, Andrew and I spent a lot of time talking about the WAIC and the PRC approach to open models. You can listen to the whole podcast here, and here is a relevant clip:
