The Fair Trade Commission will warn brokerage firms that underpricing initial public offerings on the stock exchange may violate the antimonopoly law, sources familiar with the matter said Wednesday.
The FTC is expected to warn against the practice in a report to be released soon in a bid to help newly listed companies access sufficient funding through the market. In Japan, share prices on the first day of trading often greatly exceed IPO prices, with the arbitrage larger than that seen in Europe and the United States.
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