China's IPO market dominates the globe with a $58 billion boom

8 Aug 2022 , 09:18 AM

This year, massive initial share sales have almost stopped in all of the main financial hubs throughout the world, from London to Hong Kong. But a lot is going on in the Chinese market.

For instance, the Initial Public Offerings(IPO) on mainland marketplaces have increased to $58 billion so far in 2022. However, it was the highest number ever for such a period. Since January, there have been five IPOs for more than $1 billion, and a sixth is imminent. In contrast, there was only one such sale in each New York, Hong Kong, and London.

According to Economic Times, China’s IPO market has resisted obstacles including rising interest rates and worries about a US recession, which have effectively stopped substantial equity fundraising elsewhere. Offerings in the Asian economy are primarily targeted at local investors because its monetary policy differs from that of the Federal Reserve.

According to market observers, the increase in listings is partly motivated by worries that the economy may get worse later in the year as Beijing sticks to its COVID-Zero plan due to resurgences in virus infections. The official growth projection for this year has been reduced by top leaders, dwindling hopes for a recovery.