China has removed the head of its securities regulator after a steep drop in the country’s stock market, according to a report from state media.
Yi Huiman has been removed as head of the China Securities Regulatory Commission, Xinhua News Agency reported. He’ll be replaced by Wu Qing, a veteran of the agency who also ran the Shanghai Stock Exchange for two years.
The Xinhua report didn’t say why Yi has been replaced. Xi Jinping, China’s president, reportedly met with regulators on Tuesday to discuss the slide in the stock market.
“Headlines on China replacing the securities regulator head in a surprise move, add fuel to expectations that more support for stocks could soon be announced,” said Kaanhari Singh, a Hong Kong-based analyst at Barclays.
The volatility in the stock market has upset China’s citizens to such a degree that they started commenting on a U.S. embassy social media post on giraffes to lament the downturn.
The Shanghai Composite
has skidded 12% over the last 52 weeks, and declined 5% this year, though it has gained 5% from the lows of Monday.
The index last week closed at its lowest level in nearly four years.
The stock-market rout has been worse for smaller companies: Chinese small-cap stocks slumped by 6.2% on Monday.
In reaction, the government has taken a series of steps, including stronger limits on short selling and government purchases of stocks.
Singh said the selling may continue. “We think events of this week prove that China is indeed not willing to tolerate a deep stock market sell-off from current levels but we’re not close to finding a bottom yet,” she said.
For U.S. investors, the iShares MSCI China ETF
has dropped 25% over the last 52 weeks, and the KraneShares CSI China Internet ETF
has declined 23% over the same time period.