The capital in China's A-share market rose nearly 600 billion yuan (US$87.84 billion) in the last two months, making the total capital invested in the stock market more than 1.7 trillion yuan as of the end of July, according to a report compiled recently by the Shanghai Securities News and the Shenyin and Wanguo Securities.
Chinese regulators ended a temporary ban on initial public offerings (IPO) on June 29, and many companies have been seeking stock listings since then. Newly listed companies have also helped increase liquidity in the stock market.
The capital flows into the A-share market in July alone reached 284 billion yuan, according to the report.
New capital in the primary market – that is, where stocks are sold for the first time in IPOs – totaled 110 billion yuan, while new capital entering the stock market itself was 174 billion yuan, the report said.
Most of the capital increases in the primary market came from institutional investors. For instance, eight stock-oriented funds raised about a total of 42.4 billion yuan in July to invest in IPOs. The issuance of new stocks has generally helped attract investors to the stock market.
The total number of accounts set up to trade A shares on Chinese stock markets for the first time passed 130 million at the end of July, China Securities Depository and Clearing Corporation revealed.
Last week alone 699,000 new stock-trading accounts were opened, up 23.66 percent from a week earlier. That is the highest weekly increase since January 2008.
More than 26.26 million A-share accounts engaged in transactions last week, 2.11 million more than the previous week. That makes last week's new high the fourth consecutive week in which the number of accounts making transactions reached a new high.
A shares are denominated in Renminbi and traded on the Chinese stock markets, as distinct from B shares, which are denominated in foreign currencies. Newly opened B-share accounts were 1,631 last week, down 4.5 percent from a week earlier, according to China Securities Depository and Clearing Corporation.
(China Daily August 6, 2009)