The Blubber

Central Huijin Investment, a division of China’s US$1.2 trillion sovereign wealth fund, stepped in to buy exchange-traded funds (ETFs) on Monday, marking a direct intervention in the country’s stock market as it reels from the impact of retaliatory U.S. tariffs.

The firm announced on its website Monday afternoon that it had purchased ETFs and plans to continue such investments to “resolutely” support stability in the capital markets. However, it did not disclose which ETFs were involved or the size of the investments.

Central Huijin expressed strong confidence in the future of China’s capital markets, stating it firmly believes in the value of A shares—the yuan-denominated stocks listed on China’s domestic exchanges.

It wasn’t the only state-backed entity stepping in. China Chengtong Financial Holdings and Beijing Chengyang Investment, both under China’s state asset management system, also confirmed they’ve been buying ETFs, though they too withheld specifics.

This wave of state-backed buying marks Beijing’s first visible response to the escalating trade war with the United States, which has sparked volatility in markets worldwide and raised fears of a global recession.

Such interventions may become more common in 2025, after Chinese policymakers committed in last month’s government work report to take active steps to stabilize the nation’s financial markets.