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Thursday, August 15, 2019, 08:55
HKEX chief: Unrest will hinder city's development
By Edith Lu
Thursday, August 15, 2019, 08:55 By Edith Lu

Hong Kong’s current social unrest could have a huge, long-term bearing on the city’s development, Hong Kong Exchanges and Clearing Chief Executive Charles Li Xiaojia warned on Wednesday.

“Violence is creating nightmares for the people, and making it harder for them to achieve their goals,” he said, referring to the violent acts of protesters at Hong Kong International Airport on Tuesday night.

Violence is creating nightmares for the people, and making it harder for them to achieve their goals

Li Xiaojia, HKEX chief 

Residents should be rational and refrain from violence, Li said after the local bourse operator announced its interim results on Wednesday.

In his view, the current volatility in the stock market has much more to do with the protracted Sino-US trade tensions and the interest-rate trend rather than the continued spate of protests in Hong Kong.

Nevertheless, the road ahead remains rough as the trade spat has slowed the SAR’s economy, and market sentiment has been somewhat dampened by the demonstrations. 

On Hong Kong’s performance with regard to initial public offerings, Li said IPO funds raised in the city surged 39 percent year-on-year, although the number of new listing applications has fallen and more planned issues withdrawn.

READ MORE: Residents urge end to unrest in Hong Kong

The local IPO market is going through its worst summer since 2012, with the number of new company listings having dwindled by half to 15 last month, and funds raised plunging 57 percent to $1.65 billion. So far, only one company is due to go public in Hong Kong in August.

In the first half of this year, the average daily trading volume on the local bourse tumbled 23 percent to HK$97.9 billion, compared with the same period in 2018. The average daily trading volume in July fell to its lowest level since the start of the year -- down 23 percent year-on-year to HK$68.7 billion.

ALSO READ: Hong Kong pulls out all the stops in world IPO race

HKEX posted profit attributable to shareholders of HK$5.2 billion for the six months ended June 30 -- up 3.25 percent -- compared with the same period a year ago. Revenue and other income climbed 4.69 percent to HK$8.58 billion.

The inclusion of Chinese mainland A-shares in global indexes in February helped boost income from the Stock Connect by 39 percent to a record HK$508 million. Northbound trading turnover hit a new daily record turnover of 77.4 billion yuan on May 6.

HKEX said it has reached consensus with both the Shanghai Stock Exchange and the Shenzhen Stock Exchange on the criteria for Hong Kong-listed dual-class shareholding companies to be included for the first time in southbound trading through the Stock Connect.

According to Li, the mainland exchanges have completed week-long market consultations, and are finalizing the approval process.


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