Editor's note: Liu Chunsheng is an associate professor at the Beijing-based Central University of Finance and Economics and deputy dean of the Blue Source Capital Research Institute. The article reflects the author's opinion, and not necessarily the views of CGTN.

On October 18, the Shanghai Stock Exchange Composite Index fell below 2,500 points, and the stock market hit a historical low since 2015.

On October 19, Liu He, Chinese Vice Premier,  Yi Gang, governor of the People's Bank of China, Liu Shiyu, chairman of the China Securities Regulatory Commission (CSRC), and  Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, issued statements on the volatility of China's capital market and the performance of the Chinese economy.

On the same day, China's National Bureau of Statistics released economic data of the first three quarters. Against the background of increasing trade friction between China and the United States, China's financial performance remained stable.

However, Chinese investors and enterprises are increasingly worried about the uncertainty of the external environment, the future direction of China-US economic and trade relations, and China's economic prospects, which partly led to the tumble of the A-share market.

From the speech of Vice Premier Liu He, the China-US trade friction has indeed brought some negative influence to the market and export enterprises, but the expectation is playing a more prominent role than the actual impact.

Moreover, the interest rate hikes in significant economies have caused tumbles in the global stock markets, including the US. On the other hand, many international investment institutions continue to be optimistic about China's stock market and believe that China's listed companies have high investment value. 

The Chinese government not only attaches importance to the investment and financing functions of the stock market, but also pays attention to the interests of investors.

Recently China's regulatory authorities are studying new reform measures, and intend to launch a series of policy tools to stabilize investors' expectations and help to overcome the difficulties of listed companies.

The governor of the central bank, Yi Gang, said that the People's Bank of China is studying to introduce targeted measures to alleviate the financing difficulties of enterprises and comprehensively use monetary policy such as refinancing, rediscounting, and medium-term lending facilities to support private enterprises.

Guo Shuqing said that it is necessary to take full use of insurance funds and increase the financial and strategic investment in high-quality listed companies. Also, Liu Shiyu expressed that the CSRC always adhere to the reform and opening up to stabilize and boost market confidence.

Liu He stated that the central government has not wavered in the basic policies of private enterprises, affirmed the important position of private enterprises in the Chinese economic system, and the Chinese government would gradually introduce policies and measures to support the development of private enterprises including the tax cut and financing facilities. 

At the same time, the reform of state-owned enterprises will continue to deepen. The Chinese government will create an equal and fair business environment, strengthen the protection of property rights and deepen reform and opening up.

The statements of Chinese officials have boosted the confidence of the market. The A-share market has surged today. However, maintaining the market's prosperity requires not only official statements but also the implementation of actual reform policies. After all, action speaks louder than words.

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