Top Chinese officials have staged an extraordinary intervention to stem the stock market bleeding

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Chinese policy makers have stepped up their efforts to ease concerns about the ongoing selloff in domestic stocks.

The head of China’s central bank, along with a number of chief financial regulators, each made pledges of support in an unusually coordinated display of positive rhetoric.

People’s Bank of China president Yi Gang said recent stock market declines had been driven by sentiment, rather than underlying fundamentals.

“Market volatility is mainly affected by investor expectations and sentiment,” Yi said, in a statement on the PBOC’s website.

In addition, “financial risk prevention and control has progressed” while “the economy continues to maintain steady growth.”

Yi said the PBOC plans to introduce measures that will provide financing support for Chinese companies and maintain credit growth in the economy.

China’s benchmark Shanghai Composite index has fallen by more than 30% this year, as the economy navigates domestic headwinds and the increasing threat of a US-led trade war.

After more heavy falls yesterday, the index rebounded and was up more than 2.5% in the session.

In a separate statement, Liu Shiyu, chairman of the China Securities Regulatory Commission (CSRC), announced a series of support measures on the CSRC website.

Among the changes, Liu said the CSRC would promote reforms that free up listed companies to repurchase stock, help foster merger & acquisition activity and provide easier access for foreign investment.

And the chairman of China’s insurance and banking regulator, Guo Shuqing, said insurance companies will be allowed to offer products that ease liquidity concerns for companies who have pledged their own share capital to raise debt.

One year ago, Chinese President Xi Jinping renewed his pledge to address the build-up of risks in China’s financial system at the 19th National Congress of the Communist Party.

But over the course of 2018, policy makers have introduced a number of more supportive measures to help bolster the economy.

Tax cuts and infrastructure investments were announced in July, while the central bank has also enacted measures to boost liquidity in recent months.

Earlier today, China’s Q3 GDP data just missed forecasts, falling to the lowest rate of growth since 2009.

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