© Reuters. Shanghai bourse details steps to curb abnormal trading on new tech board

SHANGHAI (Reuters) – The Shanghai Stock Exchange (SSE (LON:)) said on Friday it would closely monitor any abnormal trading patterns on its newly-launched Nasdaq-style tech board, in a bid to curb financial risks and protect investors interests.

China officially launched the STAR Market on Thursday, Shanghai’s new tech board which was designed to give market forces a bigger role in setting stock prices.

But the country’s top securities regulator Yi Huiman flagged the risk of short-term speculation and high volatilities when stocks start trading on the board. [L4N23K15K]

There will be no daily limits for the first five days of trading in new stocks, compared with the existing 44 percent limit on other boards. In contrast to a 10% daily trading limit on other mainland exchange-run boards, stocks listed on the STAR Market are allowed to rise or fall by up to 20% a day.

SSE published rules on Thursday which it said were aimed at “preventing big market fluctuations, while maintaining market liquidity.”

If stocks rise or fall more than 30%, or 60%, for the first time within a session, trading would be suspended for 10 minutes.

The rules also defined what SSE sees as serious abnormal fluctuations over 10, and 30 trading days.

The exchange said it will punish investors engaged in abnormal trading behaviors including fake bidding, pump and dump, and stock price manipulation.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link