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Beijing Stock Exchange starts trading

Beijing Stock Exchange

China’s securities regulator said the new exchange will complement two other Chinese bourses in Shanghai and Shenzhen

Trading on China’s Beijing Stock Exchange kicked off on Monday, with 81 companies in the first batch of listings. The listings included 71 companies transferred from the ‘select tier’ of Beijing’s over-the-counter New Third Board, and 10 companies that recently conducted initial public offerings (IPOs) on the new bourse.

The New Third Board, which was set up in 2013, now houses a total of 7,033 small and medium-sized enterprises (SMEs). It has three tiers – Base, Innovation, and Select, filtered by the quality of the firms.

The Beijing Stock Exchange has been set up to serve SMEs, underpinning China’s “common prosperity” policy aimed at reducing wealth gaps in the country. It comes alongside other support measures for SMEs that have historically struggled to get financing in China.

Yi Huiman, chairman of the China Securities Regulatory Commission, hailed the launch of the BSE as another landmark in China’s capital market reform and development.

China’s securities regulator said the new exchange will complement two other Chinese bourses in Shanghai and Shenzhen. Launching the exchange is also part of China’s efforts to channel more household savings into the stock market to fund innovation and economic recovery while reducing the economy’s reliance on bank lending.

Shares of the 10 newly-approved companies had triggered temporary suspension twice as their prices jumped by over 60 percent. The shares continued surging after trading resumed, with the highest surging by over 500 percent at one point.

There is no limit on the price change of the newly listed companies on the first trading day, but trading will be suspended for 10 minutes when stock prices fluctuate by over 30 percent and over 60 percent.

From announcement to trading, the Beijing Stock Exchange took two months, the fastest among all bourses in China.

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