Jul 08, 2019 (China Knowledge) - Shanghai Stock Exchange’s (SSE) Star Market, the NASDAQ-style technology board, is to make its debut three weeks ahead of schedule on July 22, and 25 companies received approval to trade on the board on that day.
The idea of Star Market was proposed by the Chinese President Xi Jinping last November, aiming to prop up China’s technology companies in the midst of the China-US trade war. China has sped up the launch of this board as the trade disputes escalate.
The China Securities Regulatory Commission (CSRC) officially launched the new STAR market on June 13. The board is a new platform for mainland Chinese tech companies, such as those specialized in chip making and biotechnology, to raise funds.
The government-backed board is considered by many investors as one with substantial growth potential. Suzhou HYC Technology, the first company to launch IPO on it, has been oversubscribed 335.6 times.
There is no daily trading limit for the first 5 days, but SSE will intervene if any sharp price movements happen. Trading will be suspended for 10 minutes if a company’s stock surges or falls by 30% from its opening price. If the price change reaches 60 % during intraday trading, an additional 10 minutes suspension will be added.
After the first 5 trading days, 20 % daily upside and downside limit is set for companies traded on this new board, and that for stocks in other mainland Chinese exchanges is 10%. Meanwhile, stocks traded on the first day are subjected to a trading cap of 44% in gains.
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