Investors shake off speculation of new listings
Updated: 2013-05-04 01:17
By XIE YU in Shanghai (China Daily)
|
|||||||||
![]() |
Investors at a brokerage in Fuyang, Anhui province, on Friday. The benchmark mainland index surged by 1.44 percent. Lu Qijian / for China Daily |
The Chinese stock market rallied strongly on Friday, as investors ignored predictions of a deluge of IPOs that many fear could depress stock prices by siphoning off investment funds.
The China Securities Regulatory Commission has reopened the IPO door by launching preliminary reviews of as many as 88 companies that have applied for a market listing.
Sixty-five companies are said to be waiting to list on the main board and the small and medium-sized enterprises board. A further 23 have tendered IPO applications for the Nasdaq-style board, ChiNext, according to statements on the official website of the CSRC.
"It is a large number, but I am reluctant to say the preliminary review necessarily signals the IPO reopening," said Jasper Wang, a senior sponsor representative at a mid-sized brokerage in Shanghai.
Even if it does signal a reopening, there will be a long time lag before the impact of a flood of IPOs will be felt in the market, analysts said.
A preliminary review usually takes about six months to complete. Moreover, analysts said they don't expect a large number of applicants to pass the test.
The benchmark Shanghai Composite Index surged by 1.44 percent to 2,205.5 on Friday, climbing above the 2,200 psychological level, bolstered by the Shanghai Securities News report that renminbi qualified foreign institutional investors quota approvals may be resumed by the central bank after a two-month suspension.
The CSRC has placed a moratorium on IPOs since the end of last year, ostensibly to placate small investors who blamed the drain of investment funds for the losses they took in the bear market.
At the time, more than 800 enterprises had applied to go public, raising the specter of an oversupply of shares that could plunge the market into deeper despair. The CSRC's move to return the filings to issuers for further review was seen as a bid to block the flood.
Meanwhile, the authority has imposed the "most stringent" inspections into companies awaiting IPO approval.
The CSRC in early April randomly selected 30 enterprises to accept special financial checks from the CSRC.
China Securities Journal said on Friday that the CSRC has finished inspecting the first 15 companies, and will examine the reports submitted by the other 15 next week.
Small investors are concerned about a flood of new shares affecting the fragile equity market, which saw a major rally in the first two months in 2013, before experiencing corrections amid concerns about liquidity and a weaker-than-expected macro economic situation.
"I hope IPO approval can be slowed, because investors need time to regain confidence in the market," said a female surnamed Yu, who was watching market performance at a brokerage of Guotai Junan Securities Co in Shanghai.
"There were too many refinancing programs and IPOs in the stock market. The CSRC needs to continue its inspections and keep companies with potential problems out of the market," said Din Ji, 29, a small investor based in Hangzhou.
Lin Shuying contributed to this story
- Funds for canceled IPOs 'hard to cash out'
- Companies backed by VC, PE firms cancel IPOs
- Work on IPO reform 'going smoothly'
- Two lenders' IPO applications suspended
- No word yet on first post-moratorium IPO
- Depressed market for China's IPOs
- CSRC terminates reviews for 111 IPO applications
- Companies pull out before strict IPO audit deadline
Michelle lays roses at site along Berlin Wall
Historic space lecture in Tiangong-1 commences
'Sopranos' Star James Gandolfini dead at 51
UN: Number of refugees hits 18-year high
Slide: Jet exercises from aircraft carrier
Talks establish fishery hotline
Foreign buyers eye Chinese drones
UN chief hails China's peacekeepers
Most Viewed
Editor's Picks
![]()
|
![]()
|
![]()
|
![]()
|
![]()
|
![]()
|
Today's Top News
Shenzhou X astronaut gives lecture today
US told to reassess duties on Chinese paper
Chinese seek greater share of satellite market
Russia rejects Obama's nuke cut proposal
US immigration bill sees Senate breakthrough
Brazilian cities revoke fare hikes
Moody's warns on China's local govt debt
Air quality in major cities drops in May
US Weekly
![]()
|
![]()
|