Shenzhen's SME exchange launch comes as the city waits for Shanghai to steal its thunder, writes Mark O'Neill
When Shenzhen launched China's potential Nasdaq-style second board last Thursday it should have been a day for celebration.
The city had lobbied for the new exchange for years with uncertain prospects for success. The board will help small and medium-sized enterprises (SMEs) raise funds, marking an important step in China's long march towards developing its capital markets.
Thursday's opening was a low-key event, with limited media access. Hosting officials threw iced water on expectations.
'Building a board for SMEs requires a long-term and practical transition,' China Securities Regulatory Commission chairman Shang Fulin said at the opening.
Enthusiasm for the new board is tempered as the city will soon need to close the main Shenzhen Stock Exchange. Authorities want to merge the exchange with that of Shanghai, saying no country can have two directly competing stock markets. The second board was promised to Shenzhen as compensation.