Hong Kong stock markets remain open whatever the weather as policy to halt trading during extreme weather axed
Hong Kong Free Press
Investors will continue to trade stocks on Hong Kong markets during typhoons or rainstorms, as the city’s policy of trading halt during severe weather was officially scrapped on Monday.
The Hong Kong Exchanges and Clearing Limited (HKEX) implemented new trading arrangements on Monday that will prevent any suspension or delay in the city’s securities and derivatives markets under adverse weather conditions such as typhoons and rainstorms.
Regardless of weather warning signals, the Hong Kong markets will continue to operate until the usual market closure time. Stock Connect would also remain open.
According to HKEX’s website, on a severe weather trading day, remote working and the use of online services were “strongly encouraged.” No public-facing physical outlets should provide services, it said.
HKEX said 99.9 per cent of the securities market share and 100 per cent of the derivatives market share indicated that they were ready to operate under severe weather. As of September 10, Bright Securities Limited, OnePlatform Securities Limited, Sun Capital Securities Limited and Sun Securities Limited had said they were not ready for the new trading arrangement.
According to a consultation paper released by HKEX last November, adverse weather conditions including tropical cyclones and severe rainstorms had forced 11 market closures since 2018. The market was most recently suspended earlier this month, when Super Typhoon Yagi skirted the city.
The policy was first announced in June by Chief Executive John Lee, who said he had accepted recommendations from a government task force on promoting stock market liquidity in order to enhance stock market competitiveness.
The city’s leader said at the time that Shanghai and Shenzhen already kept their markets open during severe weather, and there was “no reason” why trading could not carry on in Hong Kong given that trades were made electronically.
In a video shared by HKEX last Monday, Secretary for Financial Services and the Treasury Christopher described the new trading arrangement as an “important reform” that was achieved by the collaboration of market participants and different stakeholders.
The minister went on to say that uncertainties were what the financial markets wanted to “see the least,” and the new policy would make the Hong Kong market “aligned” with international practices.
“We have to continuously reform and enhance our trading mechanisms to strengthen our role of connecting mainland [Chinese] and overseas capital,” Hui said in Cantonese.
In the same video, HKEX Deputy Chief Executive Officer Wilfred Yiu thanked the government, regulators and market stakeholders for backing the new trading arrangement which he described as an “important step to advance our market infrastructure.”
“Our market stakeholders have been well-prepared to provide services for Hong Kong, mainland and international investors, regardless of weather conditions,” Yiu said in Cantonese.
Support HKFP | Policies & Ethics | Error/typo? | Contact Us | Newsletter | Transparency & Annual Report | Apps
Help safeguard press freedom & keep HKFP free for all readers by supporting our team
HKFP has an impartial stance, transparent funding, and balanced coverage guided by an Ethics Code and Corrections Policy.
Support press freedom & help us surpass 1,000 monthly Patrons: 100% independent, governed by an ethics code & not-for-profit.