Black hole drives China stock market speculation

BEIJING • Investors are never short of trading ideas in China's US$7.6 trillion (S$10.3 trillion) stock market. Yesterday, they found inspiration - in the form of a super-massive black hole.

Companies linked to space telescopes and optical lenses bucked broader market declines after scientists released the first-ever image of a black hole.

Phenix Optical surged by the 10 per cent daily limit in Shanghai to its highest since June. Zhejiang South-east Space Frame jumped as much as 10 per cent, while Shanghai Moons' Electric, whose products are used in China's Fast radio telescope project, climbed more than 4 per cent before paring gains.

China's retail investors are no strangers to quirky trading, such as buying stocks with names that sound like US President Donald Trump's. Firms with even the loosest links to next-generation 5G networks were among the favourites this year, though that trade quickly unravelled.

Zhejiang and Shanghai Moons' Electric were not alone in turning lower after an early surge. Hytera Communications, which develops radio terminals and wireless communication products, went from a 4 per cent gain to a 2.2 per cent loss.

"The trade is just going to be a flash in the pan," said Shanghai-based fund manager Dai Ming with Hengsheng Asset Management. "It's always a game of hot potato, and the last ones left with them are doomed."

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A version of this article appeared in the print edition of The Straits Times on April 12, 2019, with the headline 'Black hole drives China stock market speculation'. Print Edition | Subscribe