HKEX soars as China eyes easier trading

Hong Kong Exchanges and Clearing (0388) hit an intra-day high of HK$587 yesterday as China said it is looking at easing restrictions on personal capital accounts that may help mainlanders to invest further in the local stock market.

HKEX closed 0.79 percent lower at HK$562.5.

The State Administration of Foreign Exchange will conduct a study to see if it can allow domestic investors to use their annual forex quota for the purchase of securities and insurance offshore, director of the capital account management department Ye Haisheng wrote in an article published in China Forex magazine. The amount would be within an annual quota of US$50,000 (HK$390,000) per person.

HKEX is to announce its full-year and last-quarter results tomorrow and Goldman Sachs estimates it will earn 49 percent more year-on-year but 11 percent less quarter-on-quarter. The bank expects the basic earnings per share will be HK$2.34.

UBS expects daily turnover of the stock market will be HK$193 billion on average this year and further increase to HK$230 billion next year. UBS estimated the revenue growth in 2021-2023 at 19-35 percent.

In other news, HKEX is said to be studying the special-purpose acquisition company mechanism. A SPAC a "blank check" shell corporation designed to take a company public without going through the traditional IPO process.

An HKEX spokesman said the exchange has studied or reformed different listing mechanism plans to boost Hong Kong's competitiveness and attractiveness.