Hong Kong is striving to enhance the competitiveness and liquidity of its local stock market, including the possible introduction of a new connect program to trade risk management products, the city's leaders told the inaugural HSBC Global Investment Summit in the city.
Lee said some investors have expressed "strong confidence in Hong Kong", though some have voiced their disappointment over the possibly "short-term market volatility".
The market benchmark Hang Seng Index lost nearly 14 percent last year and extended the fall by 3 percent in the first quarter of 2024.
Battling high-interest rates, a complex geopolitical environment and ballooning budget deficits, Hong Kong announced a mix of measures to lure back capital, businesses and visitors to the city in February.Lee said these measures will help Hong Kong bounce back.
"As the measures take hold and the macro environment improves, so too will be the sustainable development of the stock market - of that I have no doubt," he said.Financial Secretary Paul Chan Mo-po said Hong Kong is discussing a new connect scheme with mainland regulators, which would allow investors to trade risk management-related financial products.
"Foreign investors utilizing channels in Hong Kong to invest in the mainland would have more options to manage risks," he said, adding that the new scheme will enhance the territory's Stock Connect launched a decade ago.Connect schemes have been the key official channels that enable foreign investors to invest in mainland markets and vice versa, reinforcing Hong Kong's position as a crucial gateway for investments in mainland China.
Chan added that Hong Kong is working hard to include yuan-settled stocks into the Southbound Connect, which is expected to offer more choices for mainland investors and help boost market liquidity.
