---
type: "Topics"
locale: "en"
url: "https://longbridge.com/en/topics/24079635.md"
description: "After the Federal Reserve cut interest rates by 50 basis points and confirmed the start of a rate-cutting cycle, China's policy space has finally opened up. The last rebound opportunity for Chinese concept stocks this year, as previously mentioned by Dolphin Research, has arrived.In addition to the rare combination of interest rate and reserve requirement ratio cuts, as well as measures to address high mortgage rates for homeowners who bought at peak prices by further reducing existing mortgage rates, the real surprises were the policies targeting listed companies (CNY 300 billion, with the central bank lending to banks at 1.75% and banks lending to listed companies at 2.25%) and the tools for banks, insurers, and securities firms to borrow funds for stock purchases (CNY 500 billion). These policies are purely aimed at boosting the stock market.For example, the swap facility for banks, insurers, and securities firms allows these institutions to use their holdings of stocks/ETFs as collateral with the central bank to obtain funds for further stock and ETF purchases, creating a cycle until the facility's quota is exhausted.This isn't just about the quota (especially since the central bank has indicated it can increase the quota), but more about the fact that short sellers now face a central bank with unlimited firepower, which has a significant deterrent effect on short selling.The loan tool for listed companies to repurchase and increase holdings also positively encourages companies to step up buybacks, sending a clear warning to short sellers.Other deterrent measures include the possibility of further cuts to the reserve requirement ratio by 25-50 basis points and the potential for additional quotas if the swap facility proves effective.These policies clearly demonstrate that, with the Fed's rate cuts easing pressure on the yuan's exchange rate, China's monetary policy space has expanded. The rapid joint action by China's three major financial regulators reflects an obvious intent to rescue the market, with a pronounced deterrent effect on short sellers.In terms of results, one visible outcome is that Chinese concept stocks (which generally have ample cash but are undervalued) have seen short sellers genuinely spooked under this policy onslaught, helping valuations rebound from extreme pessimism. This is what Dolphin Research referred to as the last opportunity for China's overseas assets amid the Fed's rate cuts.However, after this rebound, sustained fundamental improvement still depends on demand recovery. What's really needed here is fiscal policy, with monetary policy playing a supporting role. The direction and scale of fiscal policy will likely only become clear after December's economic conference. In the short term, the momentum of the monetary policy-driven rally in the latter half will hinge on October's consumption performance.$Krne Csi China Internet(KWEB.US)"
datetime: "2024-09-25T01:32:17.000Z"
locales:
  - [en](https://longbridge.com/en/topics/24079635.md)
  - [zh-CN](https://longbridge.com/zh-CN/topics/24079635.md)
  - [zh-HK](https://longbridge.com/zh-HK/topics/24079635.md)
author: "[Dolphin Research](https://longbridge.com/en/news/dolphin.md)"
---

# After the Federal Reserve cut interest rates by 50…


### Related Stocks

- [KWEB.US](https://longbridge.com/en/quote/KWEB.US.md)

## Comments (16)

- **有钱能使鬼推磨 · 2024-09-26T02:31:09.000Z**: 能坚持多久
- **美谷必胜 · 2024-09-25T07:56:52.000Z**: 真牛逼。散户买入就被套，你们配合的真真鸡脖好啊
- **躺平致富 · 2024-09-25T05:57:30.000Z**: 最新播報，$Direxion FTSE China Bull 3X(YINN.US)-10% 了
- **Andy666666 · 2024-09-25T04:11:52.000Z · 👍 2**: 不用等到十二月份，9 月 27 号就有政治局会议，10 月 4 号就是财政部开新闻发布会
  - **打工人不想上班** (2024-09-25T04:28:24.000Z): You can pay attention to it.
- **京城Z先生 · 2024-09-25T03:39:01.000Z · 👍 3**: $Direxion FTSE China Bull 3X(YINN.US)夜盘已经-8% 了😅
  - **做个快乐老头** (2024-09-25T03:45:00.000Z): 丢，坚持不过 3 秒
  - **做个快乐老头** (2024-09-25T03:46:21.000Z): 不过人民币还会持续强势，中概至少坚持到年底吧
  - **京城Z先生** (2024-09-25T04:04:57.000Z): 后半句缺乏硬逻辑支持
- **空空郎君 · 2024-09-25T03:37:26.000Z**: Is it gonna explode? 😂
- **做个快乐老头 · 2024-09-25T03:35:32.000Z**: Rare to see the Hang Seng Index with half-day turnover of 150 billion
- **龙场悟道忘忧草 · 2024-09-25T03:28:06.000Z · 👍 1**: 确实爆燃了，昨天上证指数涨了一百多点，近五年没有这么爆涨过了，a 股股民等这一天等了太久了，好多都心灰意冷的退市销户了，这一波至少重回 3 千点以上了