"Chinese Brokers Restrict Cross-Border Swaps Amid Plummeting Stocks, Impact on Global Markets"
Chinese brokerages, including state-owned China International Capital Corp (CICC), have restricted domestic investors' ability to undertake cross-border swap transactions, particularly total return swaps (TRS), in an effort to defend the weak stock market. This move comes as the Chinese stock market faces renewed pressure and hits multi-year lows, with the securities regulator vowing to prevent abnormal market fluctuations and crack down on "ill-intended short selling". The restrictions on TRS could thwart domestic fund managers and allow brokers to limit overall exposure to derivatives, as Chinese authorities ramp up efforts to stem the selloff in Chinese stocks.