China ends freeze on IPOs

|By:, SA News Editor

China's government has given its approval to five companies to list on mainland stock exchanges, thereby ending an IPO freeze of over a year.

Over 760 firms are waiting to offer stock to the public, a backlog that could drag down shares of listed companies as funds flow to the new entrants.

Authorities suspended IPOs in October last year as part of a plan to crack down on fraud, reform the system and restore confidence.

Separately, Hong Kong and China could soon sign a "mutual recognition" agreement that will allow retail investors on either side of the border to buy into funds that are based in both markets. The deal could facilitate billions of dollars of cross-border investments in shares and bonds.

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