The technology board of the Shenzhen Stock Exchange will double its daily trading band from Monday in the latest move by Chinese regulators to support the nation’s hi-tech firms amid widening disputes between Beijing and Washington. The companies on the ChiNext board will be able to rise or fall by up to 20 per cent on a daily basis, having until now been limited by a 10 per cent cap. No restrictions will be imposed on how much new shares can move in the first five days of trading. Previously, new listings could rise by up to 44 per cent and drop by a maximum of 36 per cent, before the 10 per cent limit kicked in after their debut. China’s rival tech boards target Hong Kong ‘red chips’ as competition heats up The loosening of equities trading barriers is the latest move by policymakers to reform China’s three-decade old capital market. A new technology board in Shanghai, with the same trading band as ChiNext’s new regime, has proved successful in its first a year of operation. A market-based registration system for vetting initial public offerings, in which regulators will focus more on corporate disclosures and leave the judgement of companies’ growth outlook to investors, has also been applied to the ChiNext board. The ChiNext, launched in 2009, has a market cap of 8.9 trillion yuan (US$1.3 trillion) and more than 800 listed companies while its rival, Shanghai’s Star Market, is capitalised at 2.9 trillion yuan with 159 companies. About a quarter of the ChiNext companies are accessible to overseas traders through the Stock Connect, a cross-border investment channel between the exchanges of the mainland and Hong Kong. Still, its biggest constituents, lithium battery maker Contemporary Amperex Technology and Shenzhen Mindray Bio-Medical Electronics, have not yet made it to the onto that list. While the relaxation of trading restrictions will probably have no major long-term benefit for the ChiNext, the change may be bad news for the Star Market because it levels the playing field and is therefore likely to draw some capital away from the latter, according to Shenwan Hongyuan Group. Typically more volatile than the main board markets, the ChiNext companies are the best-performing group among mainland-traded stocks. The ChiNext index of the 100 biggest stocks has advanced 46 per cent this year, more than four times the gains on the benchmark Shanghai Composite Index, as record amounts of liquidity unleashed by the central bank boost the valuations of small caps. The ChiNext index rose 1.7 per cent on Friday. It is still about a third off its all-time high set in 2015, when the board led a meltdown that erased US$5 trillion in capitalisation from the broader market after a debt-fuelled bubble burst. Some 18 companies including Beijing FengShangShiJi Culture Media and Yangling Metron New Materia will start trading on the ChiNext on Monday.