Beijing has hopes for a stock market similar to the Nasdaq, as the Star Market opened with a big bang on Monday.
The Shanghai stock exchange has brought in the Star Market to compete with the U.S. in achieving super tech power.
Star Market is an initiative by President Xi Jinping which was unveiled just a few months ago. Star opened with 25 listed stocks and had quite a bit of trading day. Shares were up almost by 140 percent on an average. Star hopes to tap into the wealthy Chinese companies like Alibaba and Tencent and other local investors and companies too.
New billionaires were created through the Star Market. Local investors were said to drive the market, aided by state propaganda to drive the market higher. The need for a strong market seems to have incited trade on Monday.
Anji Microelectronics Technology soared almost 520 percent before closing with 400 percent gains. The company deals in semiconductors.
China is on a drive to make companies depend less on foreign technology and capital. The trade war has hurt the Chinese business and has fuelled the need for self-dependence.
This is not the first time that China has tried to become self-dependent. In 2009 and in 2013 it has made an attempt at competing with Nasdaq. But investor apathy had pulled down these efforts. However, Star Market is expected to be different and capture more investors and funds.
Star Market regulators have announced that six major industries will play a significant role in the market. Information technology, aerospace, renewable energy, biotech, new materials and, smart manufacturing will be welcomed.
25 companies have been listed for trade on Monday. Of these, 24 companies have been listed for the first time. They have raised almost 37 billion yuan on the first day of trade which equals $5.4 billion. Issuers can have more control over their IPO pricing.
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