Mainland markets may also get a huge liquidity injection. According to another report, China may allow locally-managed pension funds to invest up to 30 percent of their capital in equities this year. That could inject 580 billion yuan, or about 92 billion dollars, into the system.

Currently, basic pension funds managed by local governments worth about 1.92 trillion yuan, are only allowed to invest in government bonds and bank deposits.

The source, the Securities Times, also said that the government is inclined to let the National Social Security Fund manage some of the local pension money, due to its track record of relatively high returns over the past decade.

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