China’s First 30-Year Special Treasury Bond Halted Twice in Trading Debut as Price Surges

China's first 30-year special treasury bond faced trading interruptions on its secondary market debut due to repeatedly hitting daily limits [para. 1][para. 3]. Initially issued last week, the bond became available for trading on the Shanghai and Shenzhen exchanges starting Wednesday, amounting to 40 billion yuan ($5.6 billion) in value [para. 2].

On the Shanghai Stock Exchange, the bond exceeded the 10% initial daily limit shortly after trading began, leading to a 30-minute suspension [para. 3]. Trading recommenced, but the price surged for another 8 minutes, prompting a second suspension that lasted until just three minutes before the closing bell. Consequently, the bond lost most of its gains in the last three minutes, ultimately closing with a 1.3% increase [para. 4][para. 3].

A similar scenario played out on the Shenzhen Stock Exchange, where the bond experienced cycles of rallies and suspensions but closed up significantly higher at 19.7% [para. 5]. The proceeds from this 30-year bond, along with other ultra-long special treasury bonds, are earmarked to address financing gaps in key national projects aimed at building a stronger country and fostering national rejuvenation [para. 6].

The issuance of 1 trillion yuan ultra-long special treasury bonds for this year is part of a long-term strategy initiated by the government [para. 7]. The bonds will be released in stages from May to November, with half of the proceeds allocated to the central government and the other half distributed to local governments, as outlined in the Ministry of Finance’s 2024 budget [para. 8].

The raised funds will support various national priorities, including scientific and technological self-sufficiency, urban-rural integrated development, balanced regional growth, and ensuring food and energy security. These goals were articulated by a vice chairman of the National Development and Reform Commission during a press conference in April [para. 9].

For more detailed inquiries, contact reporter Zhang Yukun at yukunzhang@caixin.com and editor Joshua Dummer at joshuadummer@caixin.com [para. 10].