“The politburo meeting has led investors in the mainland to speculate that the government will probably come up with more measures to prop up stocks, so they are buying though corporate earnings are not very impressive,” Wei Wei, an analyst at Huaxi Securities, told Bloomberg.
China National Radio said Beijing will increase supervision of the stock market to protect investors and will maintain a prudent monetary policy, along with a proactive fiscal policy.
China’s first quarter earnings were not as bad as previously feared and many see signs of a stabilizing economy. Combined quarterly profits of 2,837 mainland-listed companies only fell 0.45% while 666 companies projected earnings increases or a turn to profit over the first half, Reuters reports.