Most companies are increasing on the first trading day at China's STAR Market By Reuters
© Reuters. People go to the signing ceremony of the first group of companies at the STAR Market in Shanghai By Andrew Galbraith and Samuel Shen
SHANGHAI (Reuters) – Trading struck a feverish tone on China's new Nasdaq style boards for home-based firms on their debut at Monday, with most stocks arising and drawing attention away from the Executive Board.
All the first groups of 25 companies ̵[ads1]1; ranging from chip makers to biotech companies – have more than doubled their already scary IPO prices on STAR Market, driven by the Shanghai Stock Exchange.
Trading with Anji Microelectronics Technology (Shanghai) Co Ltd, a semiconductor company, was stopped twice as the company's shares beat two switches – only after increasing 30%, and then having climbed 60% from the market opened – designed for to reassure frenzied buying.
At the noon break, Anji shares had jumped 415% from their IPO price.
However, Suzhou Harmontronics Automation Technology Co. Ltd triggered its circuit-breaker eaker in the opposite direction, falling 30% from the market open, before recovery. But at noon, the company's shares were still 113% higher than their IPO price.
Monday's budding stock prices and high volatility on the STAR market were expected when investors chased the new board, said Zhu Junchun, chief analyst with Lianxun Securities.
The investor's focus on the STAR market in the short term could weigh the main board with regard to liquidity and attention, he said.
This effect was ready on Monday, with the reference Shanghai Composite Index () plunging 0.57% at noon and the blue-chip CSI300 () trading flat.
SSE (LON 🙂 said that an index tracking of STAR Market will be launched on the 11th trading day after the debut of the 30th company on the board.
Modeled after the Nasdaq, and complete with a US-style IPO system, STAR can still be China's boldest capital market reform efforts. It is also seen driven by Beijing's ambition to become technologically self-sufficient as a longer trade war with Washington, which captures Chinese tech firms in the cross-fire.
Even veterans from China's infamous volatile stock markets had braced for a wild opening day at the New Board, following initial public offerings (IPO), were overwritten by an average of approx. 1700 times among retail investors.
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