Core Insights - The article discusses the trajectory of China's IPO market from 2021 to 2025, highlighting a "V" shape recovery influenced by macro policies and market adjustments [2][6]. Market Trends - In 2021, there were 625 IPOs in China, raising over 800 billion RMB, marking a peak [2]. - The market cooled down in 2022-2024, with IPO numbers and fundraising declining for three consecutive years, hitting a low in 2024 with only 219 IPOs and total fundraising of 143.04 billion RMB, less than 20% of the peak [2]. - A recovery is expected in 2025, with IPO numbers rising to 277, a 26% increase year-on-year, and total fundraising rebounding to 347.39 billion RMB, a 143% increase [2]. Policy Impact - The period from 2022 to 2024 saw tightened regulations aimed at improving the quality of listed companies, making it harder for non-compliant firms to go public [6]. - The full implementation of the registration system in 2023 did not lower the threshold but shifted the review power to exchanges, supporting tech innovation companies aligned with national strategies [6]. - The recovery in 2025 indicates that market participants are adapting to a stricter regulatory environment focused on high-quality listings [6]. Structural Changes in Listing Locations - The proportion of IPOs in the A-share market dropped from 84.5% in 2021 to 41.5% in 2025, while the Hong Kong Stock Exchange's share rose from 11.4% to 41.9% [8]. - The U.S. stock market saw a temporary increase in share to 24.2% in 2024 but fell back to 16.6% in 2025 as Hong Kong's appeal grew [8]. - The shift is attributed to stricter A-share IPO reviews and a preference for more flexible rules in Hong Kong, positioning it as a key platform for Chinese new economy companies [8]. Internal Market Dynamics - Within the A-share market, the Shanghai Stock Exchange's share of IPOs decreased from 51.7% in 2021 to 46.6% in 2025, while the Beijing Stock Exchange's share tripled from 9.3% to 27.8% [10]. - This growth in the Beijing Stock Exchange reflects successful policies aimed at supporting innovative small and medium enterprises [10]. Future Outlook - The article concludes that the IPO market in China has transitioned from a focus on quantity to quality, with a multi-market structure emerging [11]. - The close proportions of A-share and Hong Kong IPOs, along with the growth of the Beijing Stock Exchange, indicate a developing multi-tiered capital market system [11].

Core Viewpoint - China has opened its stock option market to foreign investors to enhance the attractiveness of yuan assets and promote international use of the Chinese yuan [1][3]. Group 1: Market Opening - The Shanghai Stock Exchange announced that qualified foreign institutional investors can now trade options for hedging purposes and can submit applications immediately [1]. - This move follows recent measures aimed at attracting global investors to China's bond market [1][3]. Group 2: Financial Instruments - Equity options provide the right, but not the obligation, to buy or sell a stock at a predetermined price in the future, which can help foreign investors hedge risks in China's 100 trillion yuan ($14.05 trillion) stock market [2]. - Currently, five option products are available on the Shanghai exchange, based on exchange-traded funds [2]. Group 3: Regulatory Environment - China's financial regulators are intensifying efforts to attract foreign investors, particularly in light of the diminishing appeal of dollar assets due to U.S. trade policies [3]. - Recent expansions include increased foreign access to the bond repurchase market and higher daily net trading limits on the cross-border scheme Swap Connect [3]. Group 4: Offshore Initiatives - Authorities have announced plans to enhance offshore yuan business in Hong Kong and have established an operation center in Shanghai to promote the global adoption of the central bank digital yuan [4].

Market Capitalization - The combined market capitalization of the Shanghai and Shenzhen stock exchanges is approaching $13.9 trillion [1] Fund Flows - Strong fund inflows are driving the market capitalization increase [1]