Hong Kong is a key beneficiary of mainland China’s excessive family savings rate. A spillover of capital into Hong Kong from the mainland’s overflowing reservoir of family savings might per chance per chance supply grand-wished relief for Hong Kong, which is fighting protracted financial and geopolitical uncertainties.
While the mainland is subjected to capital controls, Hong Kong is treated as a determined case, with Beijing frequently easing restrictions to permit cash to float below a good deal of schemes.
On the World Monetary Leaders Summit held in Hong Kong in November, Vice-Premier He Lifeng, the nation’s high financial reputable, talked about: “To urge the development of our nation staunch into a monetary powerhouse requires Hong Kong to turn out to be an even stronger worldwide monetary centre.”
In point of fact that Hong Kong’s stock market has been held relief by inadequate investment save a query to for years. Right here’s evident in a lot of ways, equivalent to how most initial public choices (IPOs) in Hong Kong don’t abolish. Within the past 5 years, 473 firms had been listed and of these 81 per cent tranquil alternate below their IPO ticket.
Second, procuring and selling volume is lacklustre. So some distance this 300 and sixty five days, the market’s common day to day turnover is HK$128 billion (US$16.4 billion), which is below stages viewed in 2020 and 2021. For comparison, the mixed day to day turnover of the mainland’s Shanghai and Shenzhen exchanges is about 5 cases greater than Hong Kong.
Third, Hong Kong share prices had been worn, with the Hang Seng Index declining 16 per cent in the past 10 years. For the length of the an analogous period, the S&P 500 index increased nearly 190 per cent.
