Stock market rebound proves Hong Kong is no financial relic, says Chan

Staff reporter

The robust rebound of Hong Kong's stock market has proven that the city is not a global financial relic and discredited its naysayers, Hong Kong Exchanges and Clearing (0388) chief executive Bonnie Chan Yi-ting said.

In late 2023, posts that the city was a "relic of an international financial center" went viral on social media amid the stock market's downturn at the time.

But the market recovered and the benchmark Hang Seng Index ended four straight years of losses by rising nearly 20 percent in 2024.

Chan said on radio that the average daily turnover of Hong Kong-listed stocks has exceeded HK$200 billion so far this year, jumping from 2023's level of about HK$100 billion and 2024's HK$132 billion.

Moreover, 11 companies went public in the city this year as of March and there are over 100 initial public offerings in the pipeline, after the new listing market saw a surge of around 90 percent in fundraising amount last year.

These achievements, Chan said, result from the efforts of various stakeholders and are strong enough to dispel the old tale that Hong Kong is a relic of an international financial center, which sprung up between the end of 2023 and beginning of 2024 when the market was down.

On three trading days this year, the full-day volume even surpassed HK$400 billion, with the majority coming by investors all over the world, Chan revealed.

The recent influx of overseas investments was thanks to China's breakthroughs in artificial intelligence technologies made by some homegrown companies, which attracted them to invest in and explore the Hong Kong market, Chan noted.

She believes the participation of overseas investors will enhance the global recognition of Hong Kong.

Driven by the bullish outlook about China's tech sector, the HSI has advanced over 23 percent this year to 24,231 points, the highest since mid-February in 2022.

The tech gauge also jumped more than 38 percent over the same period.

China's fruit tea giant Mixue (2097), which went public on March 3, rose for four trading days in a row to HK$355 per share last Friday, 75.3 percent higher than its offer price of HK$202.5.

But CCB International warns that Hong Kong equities have been heavily overbought and that the additional tariffs by the United States on exports from China could hurt market sentiment in the short term.