Investors 'Thirsty' for China's Bazooka Stimulus!

<p>&nbsp;Chinese stocks surged earlier in the week in response to measures implemented by the government on Monday.</p><p><br /></p><p>In a move to stimulate equity markets and boost investor confidence, Beijing has halved the 0.1% tax on stock trading.</p><p><br /></p><p>Other measures also announced included a cut in the deposit ratio for margin financing as well as a pledge by the China Securities Regulatory Commission to reduce initial public offering rates.</p><p><br /></p><p>As a result, major stock indices in Hong Kong and China rose higher following the news.</p><p><br /></p><p><br /></p><p>The move shows another government effort to boost its market is struggling in the face of economic concerns.</p><p><br /></p><p>Even so, China is still reluctant to implement a bigger stimulus despite growing calls to do so.</p><p><br /></p><p>Analysts from Nomura said the measures were not enough to stem the fall and were only short-term if not followed up with action to support the real economy.</p><p><br /></p><p>In addition, Evercore ISI's managing director said recovery in the stock market will not happen unless Beijing uses more 'bazooka' measures, such as the four trillion yuan (RM2. 55 trillion) stimulus package launched in 2008.</p>