Beijing, Nov 15 (EFE).- The new Beijing Stock Exchange, the Chinese mainland’s third largest stock market after Shanghai and Shenzhen, began operating Monday with outstanding profits for its 81 companies, focused on “innovation-oriented” Small and Medium Enterprises.
According to local press, up to a dozen companies had to temporarily freeze their prices during the first half hour of operations due to the significant increase in the price of their shares, which reached over 60 percent.
The market regulations say the daily share price fluctuation limit is 30 percent, but authorities decided not to apply it in the first trading session.
In this case, it has been decided to suspend the prices of companies whose shares revalue above 30 percent for 10 minutes, and another 10 minutes if they exceed 60 percent.
The official Chinese press said that almost 60 companies had profits in the first 10 minutes of trading, as is the example of the auto parts producer Henan Tongxin Chuandong, which registered an increase of almost 400 percent in the first moments of the day .
Chinese President Xi Jinping announced on Sep. 2 the creation of the Beijing Stock Exchange, which aims to become a “great starting point for small and medium-sized innovation companies.”
Yi Huiman, China Securities Market Regulatory Commission chairman, said the market’s opening represents “a milestone in the reform and development of China’s capital markets,” and will improve the “financial support” for SMEs.
The new market has not started from scratch but was established on the highest level of the National Securities Trading and Trading System, known as the “new third stock exchange,” whose 68 companies have been directly transferred to the BSE.
They were joined by others that met the requirements to access the level, until they reached 81 companies.
The trading system is an “over-the-counter” market opened in 2013 to complement the Shanghai and Shenzhen stock exchanges to offer a “low cost financing channel and simplified listing procedures” for small and medium businesses.
According to state television CGTN, the trading system at the end of 2020 was home to more than 8,000 companies – 94 percent of them small and medium enterprises – with a combined market value of 2.65 trillion yuan ($ 4.1billion.) EFE