China Says "What Recession?"

Thursday, July 30, 2009


Chinese investors flocked to new initial public offerings this week after regulators lifted the moratorium on IPOs in June. Regulators had stopped all IPOs for 10 months since last September when prices were plunging.

Shanghai's first IPO on Monday, Sichuan Expressway Co., soared 203% in its first day of trading. China State Construction Engineering Corp. followed later in the week seeing a 56% jump on its first day of trading in the world's largest IPO so far in 2009. The company raised $7.3 billion, the largest raising since Visa's successful offering in March 2008 which raised $19.7 billion.

These IPOs have started the rumblings of bubble talk among market followers. With the Shanghai Composite now trading up 82% for the year, investors are beginning for fear a correction may soon be in order. Who knows when the party will end though.


Post a Comment