The Shanghai Stock Exchange’s new Star Market (or Sci-Tech Innovation Board) got off to an auspicious start on July 22 with all 25 debutants soaring. The firms, spanning industries from microchips and biotechnology to artificial intelligence (AI), were greeted by an immediate buying spree as trading opened at 9.30 am. They all went on to record gains of at least 100% by the end of the morning session, but settled back slightly in the afternoon to close at least 84% higher.

Anji Microelectronics (Shanghai), a semiconductor manufacturer, saw its shares opening 287% higher than the initial public offering (IPO) price. Trading of Anji had to be suspended for 10 minutes at 10.20 am after the stock soared by 404% to CNY197.6 from its offering price of CNY39.19. By the close of trading, the shares were at CNY196.01, 400% higher than their IPO price. Harbin Xinguang Optic-Electronics Technology posted the smallest gain among the debutants, closing at CNY70.17, up 84.2% from the offer price. The early gains were huge across the board. By 10 am, trading in eight companies had to be suspended for 10 minutes after they surged 30% from their opening prices.

To curb over-speculation in the new market, the Shanghai exchange will halt trading for 10 minutes if a company’s stock jumps or falls 30% from its opening price during the first five days of trade. Another 10-minute suspension will be imposed if the rise or fall hits 60% during intraday trading. The new Nasdaq-style board underscores a profound shift in China’s securities sector. But for many retail investors who have lost years of savings on the stock market, the board also represents an opportunity to recoup some of their money.

Hailed as a milestone in the transformation of China’s capital markets, Star Market is expected to draw strong buying interest. The 25 companies that debuted are perceived as highly profitable and their shares were expected to soar. But the forecasted gains fell well short of the actual increases. Everbright Securities had forecast the 25 companies would see their shares surge 29% on average on the first day of trading. About four million qualified retail investors with no less than CNY500,000 in investment capital have registered to trade shares on the new market, compared to more than 100 million individual stock traders who buy and sell on the regular Shanghai and Shenzhen bourses, the South China Morning Post reports.

In total, the first trading day saw the creation of around CNY305 billion in new market capitalization on top of an initial market cap of around CNY225 billion. The average price-to-earnings (PE) ratio of the 25 firms was 53 times their 2018 earnings. By comparison, the PE ratios of previous IPOs on the mainstream Chinese boards were no greater than 23. Wild share price swings had been widely expected. IPOs had been oversubscribed by an average of about 1,700 times among retail investors. The Star Market sets no limits on share prices during the first five days of a company’s trading. That compares with a cap of 44% on debut on other boards in China. In subsequent trading sessions, stocks on the new tech board will be allowed to rise or fall a maximum 20% in a day, double the 10% daily limit on other boards. Trade volume of the 25 firms reached CNY48.5 billion, the Shanghai Daily adds.