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China securities regulator denies ChiNext crackdown
May 15, 2015 / 10:48 AM / 3 years ago

China securities regulator denies ChiNext crackdown

BEIJING, May 15 (Reuters) - China’s securities regulator on Friday denied media reports that said it was urging select fund managers to reduce holdings of stocks listed on Shenzhen’s start-up board ChiNext.

Trading in ChiNext shares has been volatile this week after the media reports which said the China Securities Regulatory Commission (CSRC) had asked several fund managers to reduce their exposure to the Nasdaq-style board, which trades at over 100 times earnings.

CSRC spokesman Deng Ge told reporters in Beijing the regulator has not given such “window guidance” to fund managers.

Investors are closely watching how the regulator views ChiNext, which has surged 115 percent so far this year, dwarfing gains of around 30 percent in China’s main indexes .

“Is it a bubble? Is it not a bubble? We don’t know. Where it will stop, we also don’t know,” said Rakesh Patel, HSBC’s co-head of equities, Asia-Pacific Markets.

On Friday, CSRC also published rules aimed at strengthening supervision in China’s fast-growing over-the-counter (OTC) market to protect investor interest from illegal trading.

An index tracking shares listed on China’s leading OTC board, the New Third Board, more than doubled in the first quarter before tumbling nearly one-fifth on concerns over tougher regulatory scrutiny. (Reporting by Zhang Xiaochong, Pete Sweeney and Samuel Shen; Editing by Miral Fahmy)

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