(Bloomberg) -- What’s the trade on China’s move to let President Xi Jinping stay in power indefinitely? Some investors may have decided that it’s buying shares in companies with “king” or “emperor” in their names.
While stocks traded on China’s mainland largely tracked Friday’s advance in the U.S., firms like Shenzhen Emperor Technology Co. saw outsized gains, with the southern China-based maker of smart-card systems surging more than 9 percent on Monday, the most since the start of November. Trading volume in the stock also spiked, to over three times what it was on Friday.
Likewise, shares of Harbin Viti Electronics Co., which has a Chinese name that means “powerful emperor,” jumped more than 4 percent, and Vatti Corp., a stove and water heater manufacturer called “Chinese emperor” in Mandarin, was up more than 1 percent to a three-week high. The shortened name for Jiangxi Huangshanghuang Group Food Co., which climbed almost 3 percent, roughly translates as “king of kings.”
Even Shanghai Emperor of Cleaning Hi-Tech Co. got a boost, rising 2.6 percent compared with the benchmark index’s 0.7 percent climb.
Chinese investors have a history of betting on stocks because of their names. Traders in the $7.7 trillion market, which is dominated by mom-n-pop investors, flocked to a stock whose name sounded like “Trump Wins Big” to Mandarin speakers as the U.S. president secured victory in November 2016, while one called “Aunt Hillary” sold off.
When China said it would build a new economic area and city near the capital in April last year, companies with “Beijing,” “Development,” “Construction,” and even “Cement” in their names benefited.
The push to remove presidential term limits from China’s constitution would allow Xi to rule beyond 2023 and further cement his status as the country’s most powerful leader in decades.
Since the announcement on Sunday, social media has been weighing in with posters both lauding -- and lampooning -- the move, and some keying off the idea it would give Xi emperor-like status. The Communist Party congress in October had already elevated the president to a level that put him alongside the nation’s most vaunted political figures.
To contact Bloomberg News staff for this story: Keith Zhai in Singapore at qzhai4@bloomberg.net, Amanda Wang in Shanghai at twang234@bloomberg.net.
To contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Emma O'Brien
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