Beijing exchange shares log record daily jump after reform measures

SHANGHAI (Reuters) – Shares on China’s two-year-old Beijing stock exchange recorded their best daily performance ever on Monday, after the country announced reform measures to improve the market that focuses on smaller innovative tech firms.

The Beijing Stock Exchange 50 Index closed up 5.9%, after the China Securities Regulatory Commission (CSRC) said on Friday it would foster innovation in Beijing’s exchange to invigorate the capital market and boost investor confidence.

The CSRC’s move comes on top of several other market and economic stimulus measures over recent weeks as China’s post-COVID economic recovery lost steam since the second quarter, while a deepening property crisis has rattled investors.

The Beijing exchange focuses on funding innovative small companies, known as “little giants”, that specialise in niche sectors.

Shares in Long Bamboo Technology Group, Hunan Wuxin Tunnel Intelligent Equipment Co and Panzhihua Bing Yang Technology Co jumped by between 20% and 30% and led the gains among the 217 listed companies in the market.

The Beijing exchange 50 index is still down 15% since its inception in April 2022.

The CSRC aimed to boost liquidity in the market by relaxing investor thresholds and improving trading mechanisms. The team of market-makers will be expanded, and all shares listed on the market will be eligible for margin financing, the CSRC said.

“The measures are a package of gifts for the two-year anniversary of the Beijing exchange,” said Zhou Yunnan, founder of NS Capital Co. “It would be beneficial to the market’s high-quality development and boost investor confidence.”

The CSRC also announced measures to ease listing rules and improve listed companies’ quality. The regulator said it will guide more mutual funds to expand their investments in the market.

(Reporting by Shanghai Newsroom; Editing by Jacqueline Wong, Shri Navaratnam and Susan Fenton)