(Yicai Global) April 1 -- Shares in Shanghai Waigaoqiao Free Trade Zone Group have skyrocketed this morning after it injected CNY160 million (USD24 million) into a joint venture specializing in Chinese securities with JP Morgan International Finance and other investors.

Its stock [SHA:600648] hit the 10 percent daily limit up to reach CNY19.59 (USD2.92) at the 9.30 a.m. opening point.

The group will take a 20 percent share of the venture, JP Morgan Securities China, which the China Securities Regulatory Commission approved late last month, Waigaoqiao FTZ Group said in a statement yesterday. The new firm has CNY800 million in registered capital and its business scope includes acting as a securities brokerage, investment consultancy and underwriter.

China's securities market has had a strong start to 2019 as Beijing continues to open up the country's financial sector to foreign investors. It began allowing overseas institutions to take majority stakes in local securities joint ventures last year, which UBS Group quickly took advantage of by extending its holdings in UBS Securities to 51 percent. Germany's Allianz also set up the first wholly foreign-owned insurance holding company on the Chinese mainland and Standard & Poor got the go-ahead to issue credit ratings in the country.

The investment will have little to no impact on Waigaoqiao's 2019 performance, according to the statement.

New York-based JP Morgan International Finance will take a 51 percent majority in the venture. Other backers include Shenzhen Wallace Rand Equity Investment Fund Management, taking 14.3 percent, and Xinjiang Zhongwei Equity Investment, Shanghai Binhe Investment Management Center and Langxin Investment, all holding a 4.9 percent stake.

Editor: James Boynton