A view of the New Beijing Stock Exchange on Financial Street, Beijing, China, November 15, 2021. REUTERS/Tingshu Wang

Shanghai, November 15 (Reuters)-The Beijing Stock Exchange began trading on Monday, and the stock prices of 10 companies that recently conducted initial public offerings (IPOs) on the China New Exchange surged 6 times and triggered a circuit breaker.

A total of 81 stocks began trading, marking the official launch of the exchange-the exchange aims to serve small and medium-sized enterprises (SMEs) and supports President Xi Jinping's "shared prosperity" policy aimed at narrowing the gap between the rich and the poor in the country.

"The performance on the first day was pretty good. I didn't see too many bubbles," said Yang Hongxun, an analyst at the investment consulting firm Shenguang. "Since President Xi supports the exchange, I think the probability of failure in this market is very small."

The performance of the other 71 stocks was mixed, and these stocks moved from the "select level" of the New OTC Market in Beijing to the new exchange.

Yi Huiman, chairman of the China Securities Regulatory Commission, said that the establishment of the Beijing Stock Exchange is a milestone in the reform of China's capital market.

Yi Jianlian said at the ceremony on Monday: "This is of great significance because it will strengthen the multi-level capital market, improve the financing system for SMEs, and promote innovation and upgrade the Chinese economy."

The Beijing Stock Exchange complements the existing exchanges in Shanghai (.SSEC) and Shenzhen (.SZSC) with larger market capitalization companies.

More than 4 million investors opened accounts on the Beijing Stock Exchange for trading. The exchange adopted a registered IPO mechanism-Shenzhen Growth Enterprise Market (.CHINEXTP) and Shanghai Technology-focused Science and Technology Innovation Board (.STAR50) also adopted this system.

Companies listed on the Beijing Stock Exchange can directly migrate to ChiNext or STAR if they meet the conditions.

At the close of trading on Monday, the 10 newly listed stocks all rose sharply. However, 59 of the 71 stocks that were transferred from the “select layer” fell.

"Capital is chasing new shares, and the existing shareholders of the'select layer' are making profits," said Zhou Yunnan, a senior investor in the New Third Board.

The first batch of listed companies mainly come from industries such as software, medicine, and high-end manufacturing.

On the first trading day, the turnover on the Beijing Stock Exchange was 9.57 billion yuan (US$1.5 billion), accounting for only 1% of the total daily turnover of the Shanghai and Shenzhen markets.

According to data from the Beijing Stock Exchange, Henan Tongxin Transmission Co., Ltd., which produces automobile transmission equipment, led the increase with a 494% increase.

Nantong Hongda Electric Co., Ltd., Hebei Ruisheng Information Technology Co., Ltd. and Anhui Jingsai Technology Co., Ltd. more than tripled.

The surge triggered the fuse mechanism or temporary suspension of trading of 10 stocks.

Investors with assets in stock accounts worth at least RMB 500,000 (US$78,347) can apply to trade on the Beijing Stock Exchange—a threshold equivalent to that of the Shanghai Science and Technology Innovation Board.

More cash inflows are expected.

According to the China Securities Regulatory Commission, eight mutual funds targeting the Beijing Stock Exchange have been registered.

Our standard: Thomson Reuters Trust Principles.

Subscribe to our daily featured newsletter to receive the latest exclusive Reuters reports sent to your inbox.

Reuters, the news and media division of Thomson Reuters, is the world's largest multimedia news provider, reaching billions of people around the world every day. Reuters provides business, financial, domestic and international news directly to consumers through desktop terminals, world media organizations, industry events and directly.

Rely on authoritative content, lawyer editing expertise, and industry-defining technology to build the most powerful argument.

The most comprehensive solution to manage all complex and expanding tax and compliance needs.

The industry leader in providing online information for tax, accounting and financial professionals.

Access unparalleled financial data, news, and content with a highly customized workflow experience on desktop, web, and mobile devices.

Browse an unparalleled combination of real-time and historical market data and insights from global resources and experts.

Screen high-risk individuals and entities on a global scale to help discover hidden risks in business relationships and interpersonal relationships.

All quotes are delayed by at least 15 minutes. Please see the complete list of exchanges and delays here.