The Chinese authorities decided to lift the restrictions on initial public offerings introduced earlier this summer. According to an official at the China Securities Regulatory Commission, the IPOs will be resumed after improvements in the listing system are made.
The commission also says that 10 companies will go public over the next two weeks, and about 20 more companies will offer their shares on the marketplace by the end of the year. China’s government banned initial public offerings this summer when the Chinese stock indices persistently plunged by 10% every day. At that time, financial authorities excluded short sales, and later they restricted initial public offerings.
A famous stock trader Thomas DeMark compared the recent summer slump in China’s market to the crash of the stock indices in the United States in 1929. The movement of the Shanghai Composite Index since March 2015 resembles the performance of the US Dow Jones Industrial Average in 1929, when it plummeted by 48%.
Today, China’s stock market reveals growth as the Chinese leading indices rebounded by above 20% from their early lows. That fact prompted the authorities to alleviate the conditions and permit IPOs.
Besides, the government released data for Chinese foreign trade last weekend which showed that exports declined by 7% in October to $192.41 billion, while imports fell by 19% to $130.77 billion. Foreign trade surplus came in at $61.64 billion.
