BEIJING, Aug. 25 (Xinhua) -- ChiNext's Monday-debuted registration-based initial public offering (IPO) raised the imminence and necessity for enhancing capital market fundamental rules, according to a report released by the research team of China Wealth Management 50 Forum (CWM50).
On Monday, ChiNext, China's Nasdaq-style board of growth enterprises, welcomed the first batch of registration-based IPOs, which was deemed as a big step for the country's capital market reform.
The CWM50 report held that the smooth implementation of registration-based IPO rules on ChiNext paved the way for the future all-around implementation of the IPO reform rules on China's A-share market.
Hence, suggestions on five aspects are proposed in the report to reinforce fundamental rules construction and press ahead with long-term development, including cranking up efforts to crack down illegal activities in securities sector and improve investor protection, optimizing transaction rules to balance development of short selling and long mechanisms, improving cultivation of capital market participants, furthering opening up, and defining the boundaries of responsibility and obligation of regulatory and supervisory departments.
In the long term, expected steady increase of listed firms on ChiNext in the future and its expanded daily trading limits will add to the difficulties for speculation on concept stocks on the board, held Everbright Securities.
Under such circumstances, value-based investment and sector leading enterprises will attract more favor from market players and looking for valuable targets based on corporate research will be the mainstream investment strategy for ChiNext-listed stocks, according to Everbright Securities.
CITIC Securities highlighted that as internal and external disturbing factors gradually ebbed, the next round of A-share market rally may be approaching. But instead of being a gaming arena for existing capital, the A-share market is more dominated by incremental capital and investors shall pay more attention to economic fundamentals and resilience.
In the following period, CITIC Securities recommended three sectors to focus on, cyclical sectors benefited from weak U.S. dollar, price rises in commodities and energy, and global economic recovery, consumption sector and financial sector that has sufficiently low valuation and has thoroughly digested negative factors. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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