London Daily

Focus on the big picture.
Thursday, Oct 23, 2025

China's answer to the Nasdaq might be starting to fizzle

China's answer to the Nasdaq might be starting to fizzle

China's latest attempt to create a Nasdaq-style stock market appears to be running into trouble just three months in.
The Shanghai Stock Exchange launched its Star Market toward the end of July, with wild gains in prices and a few eye-catching IPOs since. But it has been forced to cancel the launch of a new index based on the market that was planned for Wednesday.

The reasons: There were too few companies on the board to justify its own index, and those that are on it were "relatively too small" in size, the exchange said in a recent statement. (The market's latest member started trading Monday, bringing the total number of listed stocks to 34, up from 25 at launch.)

The pool of stocks on the Star Market is microscopic compared to other major exchanges in China that have their own indexes, including the main market in Shanghai and a tech-focused market in Shenzhen. More than 3,000 companies are listed on those markets combined.

Investors also expect any index involving Star Market components to be a critical one to watch, the exchange said. That makes it all the more important to wait until the index is able to provide a better representation of the market, it added.

That's a pretty cool assessment of the market, especially given its remarkably hot debut. Stocks gained an average of 140% on the first day of trading. One company, Anji Microelectronics Technology, closed up 400%.

As of Wednesday, though, more than 90% of the stocks on the Star Market have lost about a third or more of the value they held at their peaks, according to data from Wind, a Chinese financial information provider.

"Apparently, the investor enthusiasm has faded," said Mark Huang, an analyst for Bright Smart Securities in Hong Kong. While the valuations of the Star Market companies are still high, they are returning to more "reasonable levels," he said.

The Star Market is part of China's bid for tech superpower status. Beijing hopes it will help China's tech companies tap into the vast wealth held by local investors. The country also wants to entice global leaders like Alibaba (BABA) and Tencent (TCEHY) to return to China from stock exchanges in New York and Hong Kong.

Huang said investors are probably going to pay close attention to upcoming earnings for the companies that are listed on the board - an opportunity to assess the quality of companies that are supposed to represent China's future.

Huang added that the board needs to attract more quality companies, so that it has a bigger pool of them to select for the component index. The Shanghai Stock Exchange has indicated that 50 companies will be included on its index — but only if there are more than 50 companies on the board. Otherwise, all of the stocks could be added to the index.

The Star Market may be on its way to adding more firms. As of Friday, the market had accepted applications from 162 companies, 42 of which completed the registration process.

"The board is still in a very early stage," said Hao Hong, managing director and head of research at Bank of Communications International.

He attributed the pullback seen in stock prices on the market to lower expectations from investors, adding that the board hasn't attracted much money yet.

"I think lots of investors still have a wait-and-see attitude," he said.
Newsletter

Related Articles

0:00
0:00
Close
US Administration Under President Donald Trump Reportedly Lifts Ban on Ukraine’s Use of Storm Shadow Missiles Against Russia
‘Frightening’ First Night in Prison for Sarkozy: Inmates Riot and Shout ‘Little Nicolas’
White House Announces No Imminent Summit Between Trump and Putin
US and Qatar Warn EU of Trade and Energy Risks from Tough Climate Regulation
Apple Challenges EU Digital Markets Act Crackdown in Landmark Court Battle
Nicolas Sarkozy begins five-year prison term at La Santé in Paris
Japan stocks surge to record as Sanae Takaichi becomes Prime Minister
This Is How the 'Heist of the Century' Was Carried Out at the Louvre in Seven Minutes: France Humiliated as Crown with 2,000 Diamonds Vanishes
China Warns UK of ‘Consequences’ After Delay to London Embassy Approval
France’s Wealthy Shift Billions to Luxembourg and Switzerland Amid Tax and Political Turmoil
"Sniper Position": Observation Post Targeting 'Air Force One' Found Before Trump’s Arrival in Florida
Shouting Match at the White House: 'Trump Cursed, Threw Maps, and Told Zelensky – "Putin Will Destroy You"'
Windows’ Own ‘Siri’ Has Arrived: You Can Now Talk to Your Computer
Thailand and Singapore Investigate Cambodian-Based Prince Group as U.S. and U.K. Sanctions Unfold
‘No Kings’ Protests Inflate Numbers — But History Shows Nations Collapse Without Strong Executive Power
Chinese Tech Giants Halt Stablecoin Launches After Beijing’s Regulatory Intervention
Manhattan Jury Holds BNP Paribas Liable for Enabling Sudanese Government Abuses
Trump Orders Immediate Release of Former Congressman George Santos After Commuting Prison Sentence
S&P Downgrades France’s Credit Rating, Citing Soaring Debt and Political Instability
Ofcom Rules BBC’s Gaza Documentary ‘Materially Misleading’ Over Narrator’s Hamas Ties
Diane Keaton’s Cause of Death Revealed as Pneumonia, Family Confirms
Former Lostprophets Frontman Ian Watkins Stabbed to Death in British Prison
"The Tsunami Is Coming, and It’s Massive": The World’s Richest Man Unveils a New AI Vision
Outsider, Heroine, Trailblazer: Diane Keaton Was Always a Little Strange — and Forever One of a Kind
Dramatic Development in the Death of 'Mango' Founder: Billionaire's Son Suspected of Murder
Two Years of Darkness: The Harrowing Testimonies of Israeli Hostages Emerging From Gaza Captivity
EU Moves to Use Frozen Russian Assets to Buy U.S. Weapons for Ukraine
Europe Emerges as the Biggest Casualty in U.S.-China Rare Earth Rivalry
HSBC Confronts Strategic Crossroads as NAB Seeks Only Retail Arm in Australia Exit
U.S. Chamber Sues Trump Over $100,000 H-1B Visa Fee
Shenzhen Expo Spotlights China’s Quantum Step in Semiconductor Self-Reliance
China Accelerates to the Forefront in Global Nuclear Fusion Race
Yachts, Private Jets, and a Picasso Painting: Exposed as 'One of the Largest Frauds in History'
Australia’s Wedgetail Spies Aid NATO Response as Russian MiGs Breach Estonian Airspace
McGowan Urges Chalmers to Cut Spending Over Tax Hike to Close $20 Billion Budget Gap
Victoria Orders Review of Transgender Prison Placement Amid Safety Concerns for Female Inmates
U.S. Treasury Mobilises New $20 Billion Debt Facility to Stabilise Argentina
French Business Leaders Decry Budget as Macron’s Pro-Enterprise Promise Undermined
Trump Claims Modi Pledged India Would End Russian Oil Imports Amid U.S. Tariff Pressure
Surging AI Startup Valuations Fuel Bubble Concerns Among Top Investors
Australian Punter Archie Wilson Tears Up During Nebraska Press Conference, Sparking Conversation on Male Vulnerability
Australia Confirms U.S. Access to Upgraded Submarine Shipyard Under AUKUS Deal
“Firepower” Promised for Ukraine as NATO Ministers Meet — But U.S. Tomahawks Remain Undecided
Brands Confront New Dilemma as Extremists Adopt Fashion Labels
The Sydney Sweeney and Jeans Storm: “The Outcome Surpassed Our Wildest Dreams”
Erika Kirk Delivers Moving Tribute at White House as Trump Awards Charlie Presidential Medal of Freedom
British Food Influencer ‘Big John’ Detained in Australia After Visa Dispute
ScamBodia: The Chinese Fraud Empire Shielded by Cambodia’s Ruling Elite
French PM Suspends Macron’s Pension Reform Until After 2027 in Bid to Stabilize Government
Orange, Bouygues and Free Make €17 Billion Bid for Drahi’s Altice France Telecom Assets
×