China Raises Margin Requirement to 100% as Regulator Targets Speculation

China has tightened stock-market regulation as authorities seek to curb excessive speculation and engineer a more sustainable rally.

The China Securities Regulatory Commission said it wants to prevent sharp market swings after turnover and margin financing surged to new highs in January.

Chinese exchanges will raise the minimum margin requirement for new margin-financing borrowings to 100% from 80% from Jan 19, a move approved by the watchdog and aimed at reducing leverage in popular themes such as artificial intelligence, aerospace and robotics.

Mainland turnover reached nearly CNY4tr last week as the Shanghai Composite hovered near a decade high.

The CSRC said it will strengthen monitoring, crack down on manipulation and make counter-cyclical adjustments to stabilise markets.