By James T. AreddySept. 2, 2021 6:47 pm ETSAVEPRINTTEXTListen to articleLength6 minutesQueue
Chinese President Xi Jinping on Thursday announced the formation of a Beijing Stock Exchange in a bid to channel investment into promising young technology companies as avenues to raise money in the U.S. disappear.
The trading venue will augment an existing equity market in Beijing and specifically host innovative smaller companies, according to Mr. Xi and a statement from the China Securities Regulatory Commission.
Analysts described the plan as a restructuring or rebranding of an 8-year-old listing board in the Chinese capital where professional investors can trade equity in thousands of domestic companies, rather than as an equal of the traditional exchanges in Shanghai, Shenzhen and Hong Kong.
By throwing his support behind a new venue for equity investment, China’s president is signaling money is available to entrepreneurs, even as they see opportunities in U.S. markets dwindling, analysts said. Government authorities in the U.S. and China have in recent months soured on a technical listing strategy that young Chinese companies have for years used to sell equity in the U.S., in part because of Mr. Xi’s demands to protect homegrown technological secrets.