The Development And Future Direction Of China B Share Market

A country's financial situation reflected its economic, political and social development, as well as had a crucial influence to the country's economic growth and social evolution. Financial deepening, economic growth abd securities market innovation is the relationship between complementary, financial deepening could to a certain extent, promote economic growth and contribute to the securities market innovation. However, economic growth and the stock market system innovation can promote financial deepening. This article analysed from financial deepening, economic growth, securities market innovation and institutional economics that B share market is established when China's capital market was still not fully opening up for a channel to raise foreign investment, which was considered as a pilot "mini" capital markets.Now B-share market is facing problems mainly in 3 aspects: the overall funding level is very small comparing to the A share and H-share market, liquidity and market efficiency is low, policy is uncertainty. I believe the main reason is that environment of B-share markets has experienced major changes : 1) H shares has in fact replaced the B shares from the capital market to raise foreign investment functions; 2) speeding up the reform of RMB, China's capital market, including the Chinese economy will speed up the pace of opening up; 3) With QFII and QDII system has gradually been introduced, the A-share market is gradually opening up to foreign investors directly. With sufficient data and charts, this paper reached a first conclusion that the B-share market as part of the capital market liberalization experimental field for the historic mission has been completed. The market can no longer be developed, its fate will be closed. At last the paper is from the aspects of government regulatory departments, the Shanghai and Shenzhen Stock Exchanges, listed companies, brokerage firms and investors, the market participants' main point of how to judge, design and promote B-share market future direction - gradually merger with the A-share.