It played a significant role in helping many prominent Chinese state-owned enterprises come to market in Hong Kong.
Advertisement
The Beijing-based bank’s strong debut follows China’s lifting on Friday of a four-month ban on A-share IPOs and its promise that 28 companies previously cleared to list would do so before year-end. Borrowing to buy stocks fell abruptly in the throes of the selloff, when regulators clamped down on the gray-market lending and investors pulled back from the stock market.
On November 9, shares in China global Capital Corp, the country’s oldest investment bank, rose on their first day of trading in Hong Kong.
The benchmark Hang Seng Index traded between 22,339.69 and 22,534.92.
China’s gains added to a rally on Monday, when investors interpreted officials’ plan to reopen the domestic market for initial public offerings as a signal of the market’s firmer footing. Under the new rules, they pay only after the allocation of the shares is confirmed.
The Shanghai Composite Index turned higher by 0.4% in its morning session.
Seoul shares hit a one-week low, and the KOSPI settled 0.75% lower.
The Shanghai gauge has soared more than 24 percent since the bottom of a crash in August, technically marking a return to a bull market, market watchers said. The benchmark Shanghai Composite Index has surged more than 20 per cent from its August 26 low, despite third-quarter profits that trailed analyst estimates at 68 per cent of companies in the index, the eighth straight quarter of disappointing results. “It has all to do with the PBOC and its monetary policy”.
Yesterday, as has been the case for much of the past few months, Chinese stocks staged another wonderful rally.
India’s S&P BSE Sensex finished down 0.6%, at 26121.40, after Prime Minister Narendra Modi’s party sustained a surprise defeat in a key state election.
“The main board is now traded at 22x P/E, but the Chi-next board (small caps) is at 88x P/E. We believe the new stocks will be priced between 20x and 30x P/E as the regulator still wants to protect the interests of small investors”, says the bank.
Yields on the Chinese five-year government bond jumped to 3.05% early Friday, the highest in a month. Imports in October fell by a sharper-than-expected 18.8 per cent from a year earlier, following a 20.4 per cent decline in September. There also seems to be growing concerns around capital city house prices, notably in the wake of another drop in the Sydney and Melbourne auction clearance rates.
Advertisement
Japanese insurance firms gained on expectations of higher US interest rates, with Dai-ichi Life Insurance Co. up 5.1%.
