The latest round of large-scale stock repurchases from domestic listed firms has offset the market volatility triggered by the US’s tariff war with China. In 2025, 60.9 percent of the companies involved in buybacks have been State-owned enterprises, almost twice the rate of 2024. Since 2024, on the Shanghai and Shenzhen A-share markets, 3,100 companies’ price-to-book ratios (PBs), an indicator of potential stock investment into a company, have slid. Among them, almost half the companies whose PBs dropped by over 20 percent need better management. This year, 9 percent of buybacks are from shares priced below book values. Commercial banks have started offering loans for the buybacks and more listed companies have chosen to cancel repurchased stocks to boost market confidence. Experts have pointed out that with preferential buyback policies, SOEs are able to kick off a new round of additional purchases and repurchases to maintain market stability.
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