Let the market adjust itself

As concerns mounted over a possible correction in mainland equities, which roared to another high Tuesday, senior officials said the market should adjust itself, allaying fears of direct intervention in the markets to temper undiminished investor enthusiasm for chasing gains. Fan Gang, People's Bank of China monetary policy committee member, who also heads the National Economy Research Institute, believes the government will not put forward measures to intervene in the stock market, the state-run Securities Times reported Tuesday. The three-pronged monetary tightening move by the PBOC last Friday was focused on curbing excess liquidity and money supply, Fan was reported as saying in Shanghai Monday. The market has matured and so has the government. People should be realistic and respect market patterns, he said, adding the market should be able to deal with its own risks. Fan's comments echoed the views of Shang Fulin, chairman of the China Securities Regulatory Commission, who indicated the regulator would like to see the market mechanism adjust to any imbalance. Speculative activities in the share market are not as widespread as media has reported, Shang was quoted by mainland media as saying last week. Although the number of stock-trading accounts exceeded 90 million, only about 30 million are active, he said in a speech about capital markets. But the CSRC will speed up listing new shares of enterprises, and attract overseas-listed mainland companies to float shares in the A-share market, correcting the imbalance between demand and supply of shares, he said.