China Opens 'Beijing Stock Exchange' for Small and Medium Innovative Enterprises... Surge in Soaring Stocks

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The Beijing Stock Exchange, the third stock exchange established on mainland China, has opened.

According to major foreign media on the 15th, the Beijing Stock Exchange opened this morning, and trading began for 81 stocks. The Beijing Stock Exchange was established to provide funding support for small and medium-sized innovative enterprises.

At the opening ceremony, Yi Man, Chairman of the Securities Regulatory Commission, said, "The establishment of the Beijing Stock Exchange is another monumental event in the reform and development of our country's capital market," adding, "It holds great significance in building a more multi-layered capital market and completing the financial support system for small and medium-sized enterprises."

On the day, Tongxin surged 493.67%, and 10 stocks rose more than 100%, with many stocks soaring.

The Beijing Stock Exchange applies the highest price fluctuation limit in China of plus or minus 30%, but no price fluctuation limit is applied on the first day of listing.

The Beijing Stock Exchange was created by separating part of the New Third Board, an over-the-counter market exclusively for small and medium-sized enterprises previously operated in Beijing.

The existing New Third Board was divided into three groups for trading: the lowest tier "Basic Layer," the middle tier "Innovation Layer," and the highest tier "Core Layer." Among these, the "Basic Layer" and "Innovation Layer" remain as over-the-counter markets, while only the "Core Layer" was elevated and separated into the Beijing Stock Exchange.

Thus, excluding the Special Administrative Region of Hong Kong, there are now three stock exchanges on mainland China: Shanghai, Shenzhen, and Beijing.

The Beijing Stock Exchange is expected to operate mainly for professional investors and institutions, as small investors are not allowed to participate.

Chinese authorities have set thresholds for investor protection, allowing only those with more than two years of stock investment experience and an average daily balance of at least 500,000 yuan (approximately 92 million KRW) in their stock accounts over 20 days to buy and sell stocks on the Beijing Stock Exchange.

It is analyzed that China established the Beijing Stock Exchange to reduce its technology companies' dependence on foreign capital such as the United States amid the new US-China cold war.

Since the full-scale onset of the US-China new cold war, China has been openly sending the message that its companies prefer to list and raise funds on the mainland stock exchanges rather than the Hong Kong stock market, and on the Hong Kong stock market rather than the US market.

This content was produced with the assistance of AI translation services.