EL7.AI
StocksMedium•26 October 2026•
3 min read

1.8% CSI 300 Rebound Eases Losses in Chinese Stocks After Bear-Market Entry

Key Facts

1The CSI 300 rose 1.8% on Oct. 23, while the Shanghai Composite gained 0.9%.
2The CSI 300 fell more than 20% from its June peak before entering a bear market.
3The securities, funds and insurance companies swap facility had a size of 500 billion yuan when it was launched in October 2024.
4The manufacturing purchasing managers’ index stood at 50.1% in September, up 0.3 percentage points from the previous month.

The CSI 300 rose 1.8% on Oct. 23, while the Shanghai Composite gained 0.9%, rebounding after both indexes fell to 15-month lows, according to data cited by Investing.com. The improvement came after the CSI 300 entered a bear market the previous day, following a decline of more than 20% from its June peak. The move puts the session’s gains in the context of a sharp sell-off, after the index hit its lowest level in more than a year. The report said the indexes “rebounded from their 15-month lows” on Friday. The gains restored some balance to the market at the end of the week, but came after the index’s entry into bear-market territory was confirmed.

The government’s move to support the capital market is part of a plan announced by Chinese financial authorities in January 2025 to encourage medium- and long-term funds to enter the market. China’s State Council said the plan aims to “promote the stable performance of stocks.” The plan targets insurance, pension and social security funds. The initiative forms part of a broader framework to increase institutional investors’ presence in the stock market. The plan’s focus on long-term funds reflects the authorities’ reliance on investments with an extended horizon to support market stability.

The government plan linked the encouragement of long-term investment to changes in the periods used to assess the performance of institutions and public funds. State-owned insurance companies will be assessed over a cycle of more than three years, according to the State Council. The assessment period for the National Social Security Fund will extend beyond five years, while that for the basic pension fund will exceed three years. The plan said these periods apply to performance assessments of the entities concerned. Longer assessment periods provide room to measure results over a horizon that extends beyond short-term market volatility.

In October 2024, the People’s Bank of China established a swap facility for securities, funds and insurance companies, with an initial size of 500 billion yuan, according to the State Council. The council said the facility was launched “to promote the healthy and stable development of the capital market.” The facility is part of a set of measures that preceded the January 2025 plan to encourage medium- and long-term funds to enter the market. Meanwhile, the manufacturing purchasing managers’ index stood at 50.1% in September, up 0.3 percentage points from the previous month and returning to expansion territory, according to the National Bureau of Statistics. The bureau’s calendar lists the release of the next monthly purchasing managers’ report for Oct. 31, 2026, at 9:30 a.m.