20 February 2019

Green light for Hong Kong-Shanghai bourse linkage

China plans to connect the stock exchanges of Hong Kong and Shanghai, allowing a combined 23.5 billion yuan (U$3.8 billion) of daily cross-border trading, the China Securities Regulatory Commission said in a joint statement with the Hong Kong Securities and Futures Commission on its website Thursday.

The mutual market access will allow investors to trade 10.5 billion yuan of Hong Kong-listed stocks through the Shanghai exchange and 13 billion yuan of mainland shares through Hong Kong, the statement said.

The yearly quota for cross-border trading is 250 billion yuan for Hong Kong-listed stocks and 300 billion yuan for Shanghai shares. It will take six months of preparations before the plan can be implemented.

Linking the exchanges will “further improve the opening and healthy development of capital markets in China and Hong Kong”, Premier Li Keqiang said at the Boao Forum for Asia Annual Conference Thursday morning before details of the quota were announced.

Hong Kong broadcaster RTHK quoted Financial Secretary John Tsang as saying Thursday that the central government had announced the approval of the pilot scheme.

Tsang described the move as one of great significance, paving the way for further financial collaboration between the two sides. The link will further raise Hong Kong’s profile as a leading offshore renminbi center.

Shares of Hong Kong Exchanges and Clearing Ltd. (HKEx, 00388.HK) were suspended Thursday morning.

– Contact HKEJ at [email protected]



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