On Monday, July 22, 2019, Star Market, the Chinese competition for the Nasdaq technology exchange in the United States, has made strong gains. The shares rose by up to 520 percent on the first trading day for the scientific and technology-focused stock market in Shanghai. This is, according to the Chinese government, a further sign of the industry's resilience in the context of the war with the United States.
] Star Market was announced less than a year ago by President Xi Jinping. The government hopes that this will encourage investment in domestic technology companies and more Chinese companies at home and not in the US, as China wants to counter the pressure on its technology industry by Donald Trump's government. Huawei, the leading Chinese IT company, is at the center of US attacks, but is not listed on the stock exchange. Huawei says it can invest more in the long run.
More than 140 technology and science companies want to list their shares on the Shanghai Stock Exchange Star Market for a total of $ 128.8 billion ($ 18.7 billion).
The first 25 companies listed in the stock market segment increased 37 billion yuan with new issues and closed their first trading day between 84 and 400 percent higher.
The first day trading companies included chip makers Anji and Montage Teknik, which increased the price by 520 percent and 285 percent, respectively. Strong stock market gains are unusual in China, as stock movements are within a distance from the authorities. The stock exchanges in Shanghai and Shenzhen only allow stock prices to move 44 percent on the first trading day. Then they are limited to movements of up to ten percent. The star market has no restrictions on price movements during the first five days of a stock.