Synopsis
Shares of Chinese company Wisesoft Co. surged after assassination attempt on former US president Trump. Speculative trading based on homophones in China’s stock market drives gains. South Korean defense and nuclear energy firms also see increase amidst speculation of Trump victory.
Shares of a Chinese company whose local-language name sounds like “Trump Wins Big” soared Monday, in the latest example of growing bets on the former US president’s election victory after an assassination attempt.
Wisesoft Co., a software maker whose Chinese name “Chuan Da Zhi Sheng” implies victory for Donald Trump in Mandarin, rose by the maximum 10% daily limit in Shenzhen. The gains came as the dollar rose and Treasury futures fell as traders took stock of the likelihood of Trump winning in November after the shooting incident over the weekend.
The stock also went limit up late last month when President Joe Biden appeared to falter in his exchanges with Trump in their first TV debate.
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Individual investors, who remain the dominant force in China’s local stock market, are known for speculative trading based on such homophones. Wisesoft first made its name with outsized gains after Trump won the 2016 election, while fellow Chinese firm Yunnan Xiyi Industrial Co., or “Aunt Hillary,” tumbled 10%. Aucma Co., whose Mandarin name of “Ao Ke Ma” is similar to that of Barack Obama, also surged in 2008 after Obama’s victory.
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“There has been a common mocking mentality in A-shares, where all investors are chasing the ‘mysterious association’ between individual stock names and major global events,” said Shen Meng, a director at Beijing-based investment bank Chanson & Co. “Even though no one believes in the true existence of this association, they enjoy it.”
Elsewhere in Asia, shares of South Korean defense and nuclear energy firms also climbed as these sectors were seen as beneficiaries of a Trump victory.
