STAR boosts overall outlook for investors

0 Comment(s)Print E-mail China Daily, July 30, 2019
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Photo taken on July 22, 2019 shows the debut ceremony of China's sci-tech innovation board (STAR market) at the Shanghai Stock Exchange in Shanghai, east China. [Photo/Xinhua]

The fever seen in the STAR Market during its debut last week started to cool down on Monday with the return of daily price change limits.

According to the trading rules set by the China Securities Regulatory Commission and the Shanghai Stock Exchange, no price change limits were set for the new tech board during its first trading week which started on July 22. Starting from Monday, the daily price change limit was 20 percent, which is still higher than the 10 percent limit of the A-share market's other boards.

Based on the new trading rules, Beijing Worldia Diamond Tools saw its price increase touch the 20 percent ceiling on Monday to close at 88.68 yuan ($12.9) per share. All the other 24 companies saw price gains on Monday.

Trading remained active on the new board on Monday. The turnover rates of stock transactions for Beijing-based Traffic Control Technology, Beijing Piesat Information Technology and Suzhou Harmontronics Automation Technology all approached 50 percent on Monday. Only two companies-China Railway Signal and Communication Corp Ltd and Shanghai-based Advanced Micro-Fabrication Equipment-had a turnover rate of less than 20 percent.

The first batch of 25 companies listed on the new tech board saw their prices surge by more than 140 percent after the first trading week. Shanghai-based integrated circuit maker Anji Microelectronics even reported a 400 percent jump-the highest on the board-on the first trading day.

But analysts from China Securities said that as the price change limit comes into effect, investment in the STAR Market will become more rational and the turnover rate will further contract. The performance of companies will differ greatly based on their business, operations and market recognition.

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