China state firms vow to boost share purchases to stabilise plunging market

Several Chinese state holding companies on Tuesday vowed to increase share investment as Beijing steps up efforts to stabilise a plunging stock market on US tariff woes.

The announcements by China Chengtong Holdings Group and China Reform Holdings Corp came after Chinese state fund Central Huijin said on the previous day it would increase share holdings to foster stability in markets.

China's stock benchmark dived seven per cent on Monday amid investor worries about the risk of a damaging trade war and a global recession.

Washington last week imposed extra tariffs of 34 per cent on China, which then fired back with its own 34 per cent levies on US imports.

Chengtong said its investment units will increase holdings in stocks and exchange traded funds (ETFs) to safeguard market stability.

"We are firmly optimistic toward the growth prospects of China's capital markets," the state investment firm said in a statement, vowing to support high-quality growth of Chinese listed companies.

China Reform Holdings Corp, also known as Guoxin, said in a separate statement that an investment unit will increase holdings in tech companies, state firms and ETFs, tapping a relending scheme for share buybacks. Initial investment will be 80 billion yuan ($10.95 billion).

Another state holding company, China Electronics Technology Group, said it will boost share buybacks in listed units to bolster investor confidence.

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