China plans to reform Shanghai's Nasdaq-style Star Market to improve listing quality, attracting more capital

From South China Morning Post: 2024-06-19 04:45:29

China Securities Regulatory Commission (CSRC) Chairman Wu Qing emphasized the importance of driving tech innovation, boosting the quality of listed companies, and restoring investor confidence at the annual Lujiazui forum. His tough measures include curbs on new stock supply and stricter on-site inspection of listings to prevent misconduct.

Wu’s speech focused on creating favorable conditions to attract more capital into the market and supporting investment in core technologies. His initiatives have reinvigorated investor sentiment in Chinese stocks, with foreign investors showing interest. His goal is to promote a virtuous financial cycle in the tech industry and strengthen policy support for listed companies.

The Star Market, launched in 2019, now hosts 573 companies with a combined market value of 5.2 trillion yuan. It plays a significant role in China’s tech self-sufficiency drive, aiming to reduce reliance on US technology. Despite the market’s drop, Wu’s speech highlighted the potential for policy support to boost investment value and promote high-quality development in the capital market.

Wu outlined plans to encourage dividend payouts and buy-backs to enhance the value of listed companies. The CSRC will prioritize regulatory oversight to reduce financial risk and protect investors. Increased surveillance of high-frequency trading and derivative products will help prevent market disruptions. The Lujiazui forum underscores Shanghai’s ambition to become a global financial center and showcases China’s financial sector reforms.



Read more at South China Morning Post: China to reform Shanghai’s Nasdaq-style Star Market, improve listing quality: CSRC