Nomura pours cold water on China’s stamp-duty cut, says market-boosting measure won’t sustain stock rally, bolster growth

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by Zhang Shidong at

China’s latest package of market-boosting measures – from halving the stamp duty to curbs on supply of new shares and divestments by major shareholders – will do little to sustain a rebound in stocks, according to Nomura Holdings.

The policies, which were unveiled on Sunday night to revive investors’ confidence, are simply a follow-through of a pledge to boost the capital market made at a Politburo meeting late last month and do not represent a meaningful increment in policy support for reviving economic growth, analysts at the Japanese investment bank led by Harrington Zhang said in a report on Monday.

“The impact will be short-lived if these measures are not followed by measures for supporting the real economy,” the analysts said. “Without additional more aggressive policy stimulus, these stock market-focused policies alone will have little sustainable positive impact on stock markets, not to mention any positive impact on the economy.”

Nomura’s call stands in sharp contrast with those made by Chinese brokerages, with both Guotai Junan Securities and Soochow Securities saying that the measures will increase risk appetite and boost stock valuations.

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