US-listed Chinese stocks on Wednesday roller coaster as market sentiment swings

Source:Global Times Published: 2020/6/11 11:53:40

A trader works at the New York Stock Exchange in New York, the United States, on Oct. 30, 2019. U.S. stocks ended higher on Wednesday. The Dow rose 0.43 percent to 27,186.69, the S&P 500 increased 0.33 percent to 3,046.77, and the Nasdaq climbed 0.33 percent to 8,303.98. (Xinhua/Wang Ying)

Shares of US-listed Chinese mainland companies set off on a roller coaster on Wednesday, with multiple stocks seeing turnovers surging dozens of times and the trade-halting circuit breaker being triggered more than 100 times. 

The volatility might have been triggered by the news that Wall Street is reportedly hindering the US government from taking action against mainland companies listed there, experts said.

On Wednesday, some Chinese companies listed in the US saw their share prices flying high and then tumbling abruptly. The share price of mainland fintech company Jiayin Fintech at one point skyrocketed a stunning 900 percent but fell suddenly approaching closing. The company closed at $5.80 per share, up 96.61 percent. 

Wins Finance, another mainland finance company listed in the US, saw its share price surge 169.01 percent by closing. 

A third mainland stock,, surged and then tumbled to touch the circuit breaker on Wednesday. The company saw its share price down 66.38 percent by closing. 

What some Chinese media have called a "crazy night" may have been triggered by policy influence, as US industrial workers are attempting to block the government from cracking down on Chinese companies listed on US stock markets, said Li Daxiao, chief economist at Shenzhen-based Yingda Securities. 

"US industries' opposition to the Trump administration's anti-globalization measures should make investors more confident in the prospects of US-listed Chinese stocks," he said. 

He added that compared to US companies, Chinese shares, particularly those of medium and small-sized companies, are more sensitive to external policy changes and market sentiment on the US stock market.  

Harvard Law School Professor Jesse Fried recently said in an interview that the Holding Foreign Companies Accountable Act - designed by the US government to improve financial reporting by China-based firms trading on US stock exchanges that might force mainland companies to delist from US markets - is unlikely to pass due to opposition from Wall Street. 

According to Fried, Wall Street will be lobbying to block the legislation as it makes a lot of money from Chinese listings in the US. 

Some analysts also attributed the dramatic share price fluctuation to short-term speculative trading and active trading on the US stock markets.  

On Wednesday, the NASDAQ edged up 0.67 percent to 10,020.35 points. The Dow Jones was down 1.04 percent. 

Posted in: ECONOMY

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