China is using its capital markets to fund its AI and chip competition with the US, with CXMT's record-breaking Shanghai listing being a prominent example of this strategy.

According to Bloomberg, China is turning the power of its $28 trillion stock and bond markets to fund its technological competition with the United States. Changxin Memory Technologies (CXMT) surged 466% in its Shanghai initial public offering (IPO), closing at 49 yuan, well above its offering price of 8.66 yuan, raising 57.92 billion yuan (approximately $8.6 billion), setting the record for the largest listing ever in China's mainland semiconductor industry. The listing brought CXMT's market capitalization to 3.3 trillion yuan (approximately $488 billion), surpassing Industrial and Commercial Bank of China to become China's most valuable A-share listed company. Over the past two years, Chinese technology companies have raised approximately $217 billion through equity and debt markets. Additionally, Chinese technology companies have issued at least $38 billion in bonds this year, the highest for the same period since 2016, with an average coupon rate of only 1.9%, more than 300 basis points lower than their US counterparts.