After the outbreak of COVID-19 pandemic, work and production of China’s industries resumed in an orderly way, and the capital market became more and more active. However, historical experience also shows that the reform of China's capital market is difficult and tortuous. The majority of investors still lack confidence in the healthy development of China's capital market. We must further form a win-win situation between the capital market and the real economy through reform and innovation in key areas.From the background of this reform, the market-oriented reform in the field of production factors, especially the capital factor market, has been relatively slow, which seriously restricts the sustainable development of the national economic cycle. Based on the ongoing changes in the development situation of current international and domestic economy, the central government proposed to vigorously develop China’s capital market.From the view of internal logic of the healthy and sustainable development of China’s capital market, as a long-term financing market of enterprises, its reform should be strengthened through improving the quality of listed companies, using wealth effects of the stock market to gather market sentiments and so on.Speeding up the merger and reorganization of state-owned blue-chip stocks is an important method to promote the long-term healthy development of the stock market. China’s capital market can introduce new strategic investors, optimize the equity structure of enterprises, and improve the asset quality of listed companies through encouraging horizontal and vertical merges and acquisitions of listed companies with different ownership systems.
