China’s Renewed Stock Market Support
By 
Brendan Ahern & 
Henry Greene
Executive Summary
- We believe China's "National Team" has begun buying stocks again, as they have in the past, which has historically preceded bull market periods for China's equity market.
- Similar to September of 2024, when China's markets rallied, the PBOC is also meeting with financial institutions, extending significant swap facilities to banks, and lowering the interest rate for borrowing for the purpose of stock buybacks.
- This time, the National Team is broadening their purchases to include technology stocks and small caps, rather than focusing on the largest listed names and state-owned firms.
- We believe this may benefit the KraneShares CSI China Internet ETF (Ticker: KWEB), KraneShares China Technology & Semiconductor STAR 50 Index ETF (Ticker: KSTR), and the KraneShares Bosera MSCI China A 50 Connect Index (Ticker: KBA).
Who is China's National Team?
China's "National Team" is comprised of investment firms associated with the government, including the National Social Security Fund, pension funds, sovereign wealth funds, and state-owned investment houses. Historically during periods of market stress, this group buys stocks in order to stabilize the market. Historically, this has been done through mega cap stocks and ETFs with mega cap exposure due to their influence on indexes.
What is happening currently and how does it compare to history?
In October, this group of firms began buying domestic equity ETFs listed in China again to support the onshore stock market. Over the last month, eleven ETFs have received inflows of more than $1 billion for a total of $44.15 billion. The top 20 ETFs by inflow accounted for $52.26 billion of inflow, while the 1,329 equity ETFs listed in China have had inflows totaling $58.57 billion.1 We believe this level of concentrated inflows is a strong indication of high National Team activity, which is a potentially strong signal to investors that China's government has drawn a line in the sand and decided to step in to support the stock market, as they have done in the past.
| Category | Net Flows (USD Millions) |
|---|---|
| Large Cap ETF | $9,228 |
| Non SOE ETF | $7,066 |
| STAR ETF | $6,720 |
| Large Cap ETF | $6,522 |
| Large Cap ETF | $3,351 |
| Large Cap ETF | $3,238 |
| Mega Cap ETF | $2,311 |
| Small Cap ETF | $1,842 |
| Mid Cap ETF | $1,318 |
| Small Cap ETF | $1,309 |
| Non SOE ETF | $1,242 |
| Total | $44,148 |
We have identified, based on our research and experience, five China-listed domestic ETFs that tend to be favored by the National Team. Spikes in the buying and selling of these ETFs often precede significant market movements to the upside, in the case of buying, and the downside, in the case of selling. We have tracked the largest flow periods for these ETFs since the end of 2023.
One example of the National Team buying was centered around an announcement by Central Huijin, a state-owned fund and confirmed "National Team" member, on February 6th, 2024, that it would be significantly increasing its holdings of stocks and ETFs.2 It was followed by another announcement from the People's Bank of China (PBOC), China's central bank, that it would extend an RMB 500 billion swap facility and an RMB 300 billion re-lending facility to support stock buybacks and increased shareholdings on September 24th, 2025.3 These announcements and flow spikes preceded moves higher in the Shanghai Composite Index, as seen in the chart below.
Data from 1/2/2024 to 10/30/2026. Source: Bloomberg.
Index performance is for illustrative purposes only. Indexes are unmanaged and one cannot invest directly in an index. Index returns do not reflect fees or other costs associated with investing. Past performance does not guarantee future results. Please see below for definitions.
We believe these flows are likely to continue because the National Team has plenty of dry powder. Central Huijin, for example, held $230 billion in ETFs at the end of December of 2025. Available reporting indicates that Central Huijin substantially reduced its reported ETF holdings in Q1 2026.5
On Monday, the PBOC announced a meeting with financial institutions to discuss stock market support.4 Meanwhile, similar to in September of 2024, when China's markets rallied, the PBOC is also extending significant swap facilities to banks, and lowering the interest rate for borrowing for the purpose of stock buybacks.
Previous interventions have been mostly focused on the largest listed firms with the highest state ownerships and the ETFs that track them. However, the current interventions appear broader, including ETFs with mid and small cap stock exposure, ETFs tracking the Science and Technology (STAR) Board, and a greater share of non-state-owned firms.
How to invest alongside China's National Team:
Recent history highlights the potential upside of investing alongside the National Team, and the downside inherent in National Team selling. This is especially true, historically speaking, when ETF buying is accompanied by policy support, which we believe we are seeing today from the PBOC.
The previous major interventions by the National Team that we identified, on February 6, 2024 and September 24, 2024, preceded mostly positive performance for the KraneShares CSI China Internet ETF (Ticker: KWEB), the KraneShares China Semiconductor & Technology STAR Market 50 Index ETF (Ticker: KSTR), and the KraneShares MSCI China A 50 Connect Index ETF (Ticker: KBA) over the following one, three, six, and twelve-month periods.
China ETF Performance
Starting February 6, 2024, Following Huijin Adding to Holdings Announcement
| Performance (%) | |||||
|---|---|---|---|---|---|
| Ticker | Fund | 1 Mo | 3 Mo | 6 Mo | 12 Mo |
| Date Range | 2/6/2024 – 3/6/20242/6/24 – 3/6/24 | 2/6/2024 – 5/6/20242/6/24 – 5/6/24 | 2/6/2024 – 8/6/20242/6/24 – 8/6/24 | 2/6/2024 – 2/6/20252/6/24 – 2/6/25 | |
| KWEBChina Internet | China Internet | 1.66% | 23.36% | 5.47% | 33.71% |
| KSTRChina Semiconductor & Technology | China Semiconductor & Technology | 12.98% | 8.82% | -0.97% | 29.55% |
| KBATop 50 A Shares | Top 50 A Shares | 6.17% | 13.75% | 6.57% | 17.97% |
Starting September 24, 2024, Following RMB 500 Billion Swap Facility & RMB 300 Billion Re-Lending Facility
| Performance (%) | |||||
|---|---|---|---|---|---|
| Ticker | Fund | 1 Mo | 3 Mo | 6 Mo | 12 Mo |
| Date Range | 9/24/2024 – 10/24/20249/24/24 – 10/24/24 | 9/24/2024 – 12/24/20249/24/24 – 12/24/24 | 9/24/2024 – 3/24/20259/24/24 – 3/24/25 | 9/24/2024 – 9/24/20259/24/24 – 9/24/25 | |
| KWEBChina Internet | China Internet | 10.48% | 7.62% | 29.00% | 67.11% |
| KSTRChina Semiconductor & Technology | China Semiconductor & Technology | 37.08% | 39.34% | 45.62% | 113.39% |
| KBATop 50 A Shares | Top 50 A Shares | 12.46% | 9.11% | 9.02% | 19.02% |
Source: Bloomberg. Performance measured from 2/6/2024 and 9/24/2024, respectively. Performance shown is total return using closing price. KSTR performance from 9/24/2026 to 9/24/2025 is unusually high and was driven by significant financial support from the government. These conditions are not guaranteed to be sustained over any period.
The performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed or sold, may be worth more or less than the original cost. Current performance may be lower or higher than the performance quoted. For KWEB performance data current to the most recent month-end, please visit kraneshares.com/etf/kweb. For KSTR performance data current to the most recent month-end, please visit kraneshares.com/etf/kstr. For KBA performance current to the most recent month-end, please visit kraneshares.com/etf/kba.
Conclusion
We believe the increased flows into Mainland China-listed equity ETFs in the past month, likely driven by the National Team, and Monday's gathering of financial institutions by the central bank could be strong signals that China's government is stepping in to support the stock market.
Please click here for KSTR top 10 holdings, standard performance, and risks.
Please click here for KWEB top 10 holdings, standard performance, and risks.
Please click here for KBA top 10 holdings, standard performance, and risks.
Citations:
- Data from Bloomberg as of 10/30/2026.
- Ahern, Brendan. "Broad-Based Rebound In Mainland China and Hong Kong," China Last Night. February 6, 2024.
- Ahern, Brendan. "Monetary Policy Bazooka Unleashed," China Last Night. September 24, 2024.
- Ahern, Brendan. "The PBOC Draws A Line In The Sand On Stock Market Support," China Last Night. November 2, 2026.
- Data from Wind as of 3/31/2026.
Definitions:
Shanghai Composite Index: The Shanghai Stock Exchange Composite Index is a capitalization-weighted index. The index tracks the performance of all A-shares and B-shares listed on the Shanghai Stock Exchange. The index was launched on July 15, 1991.
Five China-listed Domestic ETFs that tend to be favored by the National Team: 510300, 510310, 159915, 588000, 510050.
