Exchange: Linkup to bolster HK role in finance
The connection of the three exchanges will help more domestic and international investors use the Hong Kong market and in turn help China’s opening up of its whole capital market, said Li Quan, CEO of Guoking (HK) Securities and Futures.
At the State Council meeting, Li said, “Initiating the Shenzhen-Hong Kong Stock Connect, based on the successful pilot program of the Shanghai-Hong Kong connect, marks another steady step toward building a law regulated capital market with international features and renders positive significance inmany areas.”
The premier also said the launch of the new connect would help investors to better share the fruits of economic development on the Chinese mainland. In Hong Kong, it will help deepen the financial cooperation between them and consolidate and boost Hong Kong’s position as an international financial center, he said.
The new connect is modeled after the ShanghaiHong Kong connect by which mainland investors could buy Hong Kong stocks, and vice versa.
Trade volume of the Shenzhen Stock Exchange reached 401 billion yuan on Tuesday, making the overall trade volume of the mainland’s stock market more than 800 billion yuan.
The connect is expected to be launched before late December, according to Charles Li of Hong Kong Exchange and Clearing. It will benefit Hong Kong’s stocks, which are undervalued, compared with those in Shenzhen, said Dennis Huang, senior real estate and financial commentator in Hong Kong.