China Stock Euphoria Lifts IPO to Record 924% First-Day Gain
QuantumCTek Co., which develops information security products, closed 924% above its $5.18 issue price on China’s Star board.
(Bloomberg) -- A Chinese initial public offering soared tenfold on its Thursday trading debut, the latest sign of euphoria in the nation’s $9.3 trillion stock market.
QuantumCTek Co., which develops information security products, closed 924% above its 36.18 yuan ($5.18) issue price on China’s Star board. That exceeded the previous record of a 614% first-day jump, posted just on Tuesday by Tinavi Medical Technologies Co. On Wednesday, Geovis Technology Co. climbed 438% in its debut.
The Star board, which will celebrate its first birthday later this month, has no limits on price moves for a stock’s first five days of trading. There’s a 44% limit for the rest of China’s market on the first day and 10% thereafter.
The frenzied trading comes as stock volume and prices have been rising quickly in China. The market has added more than $1 trillion of value since June 30, outpacing gains in everywhere else globally, and Chinese investors’ margin financing is rising at the fastest pace since 2015.
Chinese stocks extended gains on Thursday, with the benchmark Shanghai Composite Index rising 1.4% to its highest since February 2018.
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With assistance from Bloomberg