Significance
Beijing's supportive policies are likely to stabilise the market, and structural tailwinds will probably reflate it eventually. Stock market volatility is likely to have limited ramifications for the wider economy unless it is prolonged.
Impacts
Downward pressure will last until margin traders have unwound their positions, a mechanical process over which Beijing has little control.
Foreign-listed Chinese firms may reconsider plans to de-list abroad and re-list in China.
Capital account and currency liberalisation will resume, in pursuit of Beijing's goal of achieving IMF reserve currency status.
Does the Stock Market Boost Firm Innovation?: Evidence from Chinese Firms
