Hong Kong regulator SFC orders second board listing to suspend trading after shares soar 542pc
Move seen as latest attempt by securities regulator to tighten up oversight of the Growth Enterprise Market second board
An unknown construction company whose shares soared more than 542 per cent on their debut on Wednesday was suspended from trading in the afternoon on orders from Hong Kong’s securities watchdog, which has vowed to crack down on high volatility on the city’s second board.
In a rare move, the Securities and Futures Commission directed the Hong Kong stock exchange to suspend trading in shares of newly listed Growth Enterprise Market stock GME Group Holdings, effective 1pm Wednesday, according an exchange filing from the company.
The SFC and the Hong Kong Exchanges and Clearing last month jointly issued guidelines on the Growth Enterprise Market, urging issuers and investment banks to ensure their placements were“fair and orderly” to avoid high volatility in trading.
“Where it appears that these conditions may not exist after trading commences, the SFC can direct the exchange to suspend all dealing in the company’s securities to protect investors and market integrity, having taken into account all of the available information,” an SFC spokesman told the South China Morning Post on Wednesday.
Where it appears that these conditions may not exist after trading commences, the SFC can direct the exchange to suspend all dealing in the company’s securities
This is the latest move by the local regulator to tighten up on the Growth Enterprise Market which since last year has seen many new listings experience high volatility in trading.
Since the new SFC guidelines were issued in January, three companies have postponed their listing on the second board after they received more questions from the regulator regarding their plans.
