Nontradable deluge set to hit markets

SHANGHAI: This week's release of 3.85 billion nontradable shares of various public listed companies in the Chinese stock market, valued at about 30 billion yuan by last Friday's market prices, is the first wave of the much talked-about scrip flood that threatens to drown whatever is left of investors' enthusiasm in 2009.

For months, the stock market was rife with speculation on the possible impact of the scheduled release of a total of 690.6 billion nontradable shares in 2009, a whopping 400 percent more than in 2008.

Many heavyweight constituent stocks of the lead indicator, including Industrial and Commercial Bank of China (ICBC), Bank of China, and Sinopec, have hundreds of millions of these stocks in the schedule.