HKEX: trading to continue even in 'extreme conditions'

Hong Kong's bourse operator said the stock trading will continue even under “extreme conditions” after an overhaul last year as super typhoon Ragasa moves closer to the financial hub, the latest efforts of the city to maintain the market open under severe weather.

According to Hong Kong Exchanges and Clearing (0388), extreme conditions refer to situations where a severe natural disaster, such as a super typhoon, poses prolonged safety risks or severely disrupts the public's ability to travel to work.

The exchange suggests that market participants make early operational and staffing arrangements to support market functioning.

HKEX introduced its severe weather trading mechanism in September last year, allowing the securities market to stay open even under typhoon signal No. 8 or higher.

HKEX said it’s closely monitoring the situation and maintaining communication with the Securities and Futures Commission and market participants.

The operator added it would prioritize the safety of employees, traders and investors and provide further updates if necessary.

Secretary for Financial Services and the Treasury Christopher Hui Ching-yu earlier said a review of the mechanism found that physical cheque clearing could be disrupted, but authorities have encouraged brokerages to switch to electronic services.

He added suspending trading is not reasonable as Hong Kong serves global markets, while neighboring markets such as Shanghai and Shenzhen remain open during extreme weather.

Late July, Chief Executive John Lee Ka-chiu said the arrangement strengthened Hong Kong’s status as an international financial center as the city was battered by typhoon Wipha.

He noted the mechanism improves the efficiency of the territory fundraising platform and boosts its appeal to global investors.

Hong Kong Securities & Futures Professionals Association urged a trading suspension during super typhoons to ensure the safety of industry personnel and the public.