are they propping up the market or buying shares a deep discounts?
I would argue the latter.
The percentages of the stock market are too small to be significant.
However, the profit that these buyers will realize when the market turns around will be significant.
This is a 2008 warren buffett moment chinese style—the sort of thing that only people with deep pockets and long time horizons can do. But they profit handsomely.
The real question is which stocks did the government buyers purchase? Did they buy stocks with big American exposure? Or did they buy stocks with relatively little American exposure.
If they bought stocks with relatively little American exposure —then you know that they were looking for deeply discounted stocks that would in a couple years reap huge profits for the government.
If they bought stocks with large american exposure —then you know they were just propping up the market.
I have been impressed with by how clever the bureaucrats in bejjing have been. so I would guess that the answer would be the former. That they bought stocks with relatively little American exposure.
Another precedent is Benard Baruch who bought when the market was down
“The real question is which stocks did the government buyers purchase?”
The article indicates that they focused on banks, energy and insurance.
In my opinion, as soon as the “National Team” was formed to support the Chinese stock markets, insiders would naturally start looking for how to use it for their personal profit. After a few years, I would anticipate that it has been thoroughly corrupted, and has found ways to rationalize their support primarily for the companies owned by the families of the top Party members.
So far, the numbers indicate that the “National Team” has shifted into market support mode (net buyers), but not to a very high degree.
If/when President Trump drops the next (and much larger) round of tariffs on Chinese imports (which are ready to go), we will probably see them having to start to shoveling their limited money in earnest to prop up their markets.