China will cut a tax on share trading from tomorrow to support the country's stock markets after the benchmark equity index plunged 35 percent this year.
The stamp duty will be lowered to 0.1 percent, from 0.3 percent, the government said on its official Web site today.
``The government doesn't want to see a falling market, which cannot serve the purpose of fund-raising for big state companies,'' said Yan Ji, an investment manager at HSBC Jintrust Fund Management Co. in Shanghai, which manages the equivalent of about $850 million. ``We are going to see a rally.''
China's benchmark CSI 300 Index plunged this year on speculation the government will step up measures to cool inflation running at an 11-year high and on concern more stock sales will dilute the value of existing equities. The Shanghai Composite Index yesterday dropped by as much as 4 percent yesterday, taking the index 50 percent below its October record
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