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China's newest exchange begins trading in Shanghai

Shares in the first eight companies to list on China's newest stock exchange for small- and medium-sized enterprises soared on the first day of trading yesterday.

Share prices for the eight companies rose an average of 130 percent on their debut.

China launched the new exchange in Shenzhen to help smaller companies -- long-neglected by state-owned banks -- to gain better access to financing. The intention is to create an exchange similar to New York's NASDAQ for fast-growing companies, especially in the technology sector.

The biggest gainer yesterday was Han's Laser Technology Co, which more than quadrupled its offer price of 9.2 yuan (US$1.11) to end at 39.09 yuan.

Initial public offerings (IPO) often draw strong support in China's markets, which tend to be dominated by speculative trading. IPO prices are usually set low to ensure a strong debut.

"The lower priced stocks rose the most, showing that most of the buying was speculative," said Yang Xin, an analyst at Guotai Junan Securities in Shanghai.

The other seven companies that listed yesterday were: drug-makers Hualan Biological Engineering Inc, Zhejiang NHU Co and Chongqing Huapont Pharm Co,packing material maker Jiangsu Qionghua High-Tech Co, apparel maker Zhejiang Weixing Industrial Development Co, household appliance manufacturer Elec-Tech International Co and textile and construction equipment maker Zhejiang Jinggong Science & Technology Co.

Meanwhile, the agency in charge of overhauling China's money-losing state industry is looking for some foreigners.

The Assets Supervision and Administration Commission advertising openings for vice presidents and other executives at 22 firms on the Web site on Thursday and said four of the firms will consider foreign applicants.

This is the second time Beijing has advertised posts open to foreign managers in its massive effort to make its state companies more competitive.
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