China’s collection of stock stamp duty jumps more than 80% as AI frenzy boosts trading

China's stamp duty revenue from stock sales surged over 80% in the first eight months of the year, reaching 216 billion yuan (US$32.3 billion) due to improved sentiment and heightened trading activities. The Ministry of Finance reported a 82% increase year-on-year. The rise in trading was attributed to the artificial intelligence boom driving demand for equities.

Despite the benchmark CSI 300 Index remaining steady, technology stocks saw significant gains. The Star Market 50 Index, a chip-heavy index, climbed by 23% in the same period. China's stock market witnessed a daily average trading volume of 2.67 trillion yuan. The stamp duty acts as a gauge for the market, and the government has adjusted it to influence investor sentiment, cutting it to 0.05% in 2023.

The rate moderated in August, marking the slowest growth this year, as concerns over the AI trade's impact on sentiment and trading discouraged activity. The global tightening of monetary policy and elevated sovereign bond yields have cast a shadow on the outlook for technology stocks. The China Securities Regulatory Commission announced a reward for whistle-blowers in cases of disciplinary breaches, including corporate non-compliance, insider trading, and fraudulent accounting, in an effort to boost market sentiment.