HKXCY - Hong Kong Exchanges and Clearing Limited

Other OTC - Other OTC Delayed Price. Currency in USD
34.69
+0.17 (+0.48%)
At close: 4:00PM EST
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Previous Close34.53
Open34.75
Bid0.00 x 0
Ask0.00 x 0
Day's Range34.65 - 35.22
52 Week Range27.90 - 36.81
Volume31,925
Avg. Volume44,719
Market Cap43.984B
Beta (5Y Monthly)1.53
PE Ratio (TTM)36.10
EPS (TTM)0.96
Earnings DateN/A
Forward Dividend & Yield0.95 (2.75%)
Ex-Dividend DateAug 25, 2019
1y Target EstN/A
  • Reuters

    EU watchdog calls on Britain to enforce bloc's market rules

    The European Union's markets watchdog said on Thursday it has asked its British counterpart to ensure that ICE Futures Europe and the London Metal Exchange fully comply with the bloc's market transparency rules for commodity derivatives. The European Securities and Markets Authority (ESMA) said it "encourages" Britain's Financial Conduct Authority to "employ timely" measures to ensure compliance with transparency obligations at ICE Futures Europe and the LME.

  • Reuters

    Hong Kong to ease reporting rules for companies' results due to virus

    Hong Kong's markets regulator and stock exchange will relax rules on how companies must publish their annual results in response to challenges caused by the newly identified coronavirus, they said in a joint statement on Tuesday. In normal circumstances Hong Kong-listed companies must publish preliminary results which have been agreed with their auditor by March 31, or have their shares suspended from trading.

  • Reuters

    Firms in China extend holidays, ask staff to work from home as virus spreads

    SHANGHAI/BEIJING, Jan 27 (Reuters) - Big businesses across China are temporarily shutting stores or advising staff to work from home, to guard against the spread of a flu-like virus as the tally of deaths rose to 80, with more than 2,700 people infected. Companies are also offering longer holidays, cancelling events and imposing quarantine, as they brace for longer-term impact following China's weekend decision to extend the week-long Lunar New Year holiday by three days to Feb. 2, in a bid to slow the spread of the virus. Hotpot restaurant chain Haidilao International Holding said it would shut stores across China from Sunday to Friday, while gaming giant Tencent Holdings Ltd and social media firm ByteDance told staff to work from home.

  • Reuters

    DAVOS-Lam courts Davos elite with dim sum, as Hong Kong scrambles to contain virus

    With dim sum, cocktails and gold chocolate coins, Hong Kong wrapped up its Davos charm offensive confident the financial hub is back on track, even as officials fly home to tackle a deadly flu-like virus. Hong Kong leader Carrie Lam arrives back to Hong Kong on Saturday, the first day of the Year of the Rat, to face with what could be a perfect storm - an outbreak of coronavirus, lingering protests and an economic downturn. Wearing a dress and pink jacket, Lam appeared unfazed as she mingled with some of the 200 business and political leaders on the Hong Kong Night of her trip, which her deputy Matthew Cheung described as a "very important diplomatic visit".

  • Hong Kong Risks Squandering Its Alibaba Dividend
    Bloomberg

    Hong Kong Risks Squandering Its Alibaba Dividend

    (Bloomberg Opinion) -- Hong Kong is missing an opportunity to displace the U.S. as an offshore listing venue for Chinese companies by keeping trading fees too high. Alibaba Group Holding Ltd.’s $11 billion offering in November showed the potential for the city’s stock exchange to attract U.S.-listed mainland enterprises amid an unsettled trade relationship between the two largest economies. Relatively expensive costs threaten to undermine that appeal.Investors get more for their dollar when they trade on the New York Stock Exchange. In Hong Kong, bid-ask spreads are wider and minimum investment requirements are higher. That increases the chance of so-called slippage, when there is a difference between the expected price of a trade and the level at which it is actually executed. With zero stamp duty and lower minimum trade requirements, the NYSE has a more favorable environment for active investors.Alibaba’s Hong Kong trading volume has slumped since the internet giant made its debut on the local exchange. On Nov. 26, shares valued at the equivalent of about $1.79 billion changed hands. Since mid-December, that figure has dropped to a daily average of about $322 million. The Hong Kong listing has made no dent in Alibaba’s stock trading in New York, where volume has averaged $3.2 billion since late November.To be sure, trading costs are by no means the only factor — or even the main one — in deciding where to buy and sell. To begin with, the U.S. is a more deep and liquid market. It has other advantages, including a more active and developed options market that gives traders more ways to hedge or speculate on stocks. That said, Hong Kong could do a better job of rolling out the welcome mat.Since losing out to New York for Alibaba’s record $25 billion initial public offering in 2014, Hong Kong Exchanges & Clearing Ltd. has made a number of rule changes to enhance its viability as a platform for technology startups from China and elsewhere. In April 2018, the exchange amended its provisions to admit companies with dual-class shares. Smartphone maker Xiaomi Corp.  and internet services company Meituan Dianping listed soon after, demonstrating that when HKEX makes smart decisions, the exchange benefits.More U.S.-traded Chinese companies are looking at Hong Kong for potential secondary listings. They include travel services provider Trip.com Group Ltd., formerly known as Ctrip; game and website operator Netease Inc.; web search provider Baidu Inc.; and e-commerce giant JD.com Inc. The way is open for Hong Kong to create a new offshore ecosystem for U.S.-listed Chinese companies seeking better positioning for the mainland while hedging their bets against a renewed deterioration in the U.S.-China relationship after the phase one agreement was signed this month.It makes little sense to squander this opportunity by maintaining trading costs that are a major barrier to entry. The Hong Kong government and the exchange must work together to make dual listing opportunities both beneficial and attractive to companies while encouraging investors to trade here. However, HKEX regulators seem to have their heads in the sand when it comes to reducing fees and the minimum buy-in to entice more companies. That may be a reflection of its monopoly status: Unlike the NYSE, which must compete with Nasdaq, HKEX has no local rival.Reducing fees would lower the barrier to entry for active investors and increase trading volume. As I wrote in September, cutting stamp duty would help improve liquidity and make Hong Kong stocks more attractive to retail and institutional investors. The ripple effect from this would further strengthen Hong Kong’s position as a global financial center. It’s time for the government and exchange to look beyond the immediate impact of reduced revenue and consider the long term.  To contact the author of this story: Ronald W. Chan at chartwellhk@bloomberg.netTo contact the editor responsible for this story: Matthew Brooker at mbrooker1@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Ronald W. Chan is the founder and CIO of Chartwell Capital in Hong Kong. He is the author of “The Value Investors” and “Behind the Berkshire Hathaway Curtain.”For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Reuters

    DAVOS-Lam launches Hong Kong charm drive as protests persist

    Hong Kong leader Carrie Lam sought on Tuesday to convince global business and political leaders at the World Economic Forum in Davos that the Asian financial hub is open for business. Hong Kong's status has come under scrutiny as seven months of sometimes violent demonstrations paralysed parts of the city and forced businesses to close, posing the gravest popular challenge to Chinese President Xi Jinping since he took power in 2012. Lam and "Team HK", including its trade secretary, top officials from the stock exchange, airport authority, MTR Corp and the head of Swire Group, are in the Swiss mountain resort after Moody's this week downgraded Hong Kong.

  • Reuters

    DAVOS-Hong Kong's Lam in Davos charm drive as protests persist

    For Hong Kong leader Carrie Lam the World Economic Forum in Davos is a chance to convince global business and political leaders that the Asian financial hub is back on track. After more than seven months of turmoil Hong Kong's status as a financial centre has come under scrutiny as sometimes violent demonstrations paralysed parts of the city and forced businesses to close, posing the gravest popular challenge to Chinese President Xi Jinping since he took power in 2012. Lam and "Team HK", including its trade secretary, top officials from the stock exchange, airport authority, MTR Corp and the head of Swire Group, are in the Swiss mountain resort two days after another violent clash and more are planned for the weekend of her return.

  • Charles Li says the best is still to come, as Hong Kong bourse reclaims world's IPO crown while more firms eye secondary listings
    South China Morning Post

    Charles Li says the best is still to come, as Hong Kong bourse reclaims world's IPO crown while more firms eye secondary listings

    Hong Kong Exchanges and Clearing chief executive Charles Li Xiaojia, who runs Asia's third-largest capital market, has rejected claims that Hong Kong's glory days are numbered, insisting the city has a bright future as a bridge between China and the international markets in the next decade."Going forward, China's further rise and the continued dominance of the US could set the two nations on a collision course. Meanwhile, the disruptive power of technology could reshape the world's economy and global society, spurring a fierce battle between these major powers for technological dominance," Li wrote in his personal blog published on Monday."This increasing polarisation means that our world needs more and better connections and not fewer. As such, Hong Kong's role as the connector between East and West will only become more vital."Hong Kong has been hit hard by the trade war between Beijing and Washington, and seven months of often violent anti-government protests that have pitched the economy into recession.London Stock Exchange's board of directors rejected a takeover bid by the HKEX in September as the social unrest raised doubts about the future role of the city as a gateway to China. Beijing's recent plan to set up a stock exchange in Macau may also create competition that further erodes HKEX's role, brokers said.Many commentators have speculated in recent months that Hong Kong's international reputation is damaged beyond repair."Amidst China's rapid development, some may look at the nation's growing wealth relative to Hong Kong's, and the falling proportion of Hong Kong's contribution to China's GDP, as indicators that the city's glory days are numbered," Li said in his "Charles Li Direct" blog on the website of the exchange.Charles Li Xiaojia, chief executive officer of Hong Kong Exchanges and Clearing, rejected the idea that Hong Kong's best days are in the past. Photo: Nora Tam alt=Charles Li Xiaojia, chief executive officer of Hong Kong Exchanges and Clearing, rejected the idea that Hong Kong's best days are in the past. Photo: Nora Tam"However, such a conclusion is at odds when you consider Hong Kong's unique and significant contributions to the development of China's financial markets, and the strong likelihood that these will be further enhanced in the years ahead."Hong Kong's GDP represented 27 per cent of China's economy in 1993, but this had dropped to 2.7 per cent by 2018.Li pointed out that foreign investment that uses Hong Kong as a route in to the mainland Chinese market represents more than 60 per cent of the total during the past decade. The percentage is the same for mainland firms investing overseas via Hong Kong.Hong Kong has ranked top of the world's IPO market seven times over the past 11 years. Among the HK$2.3 trillion (US$296 billion) in IPO funds raised in the last decade, a majority were by mainland Chinese companies, Li added.Listing reforms carried out by the HKEX in April 2018 allow companies with a dual-class shares structure, and pre-revenue biotech firms, to list here. This enabled New York-listed tech giant Alibaba Group Holding to have a secondary listing here to raise US$12.9 billion in November . Alibaba owns South China Morning Post.The stock connect has linked HKEX with Shanghai's stock market since 2014, and Shenzhen's bourse since 2016, allowing cross-border trading. International investors now hold 1.44 trillion yuan (US$206.53 billion) worth of mainland listed A-shares, 1 trillion yuan of which was bought through the connect scheme, he added.The northbound bond connect " global investors buying Chinese bonds " introduced in 2017, has seen 3.8 trillion yuan of turnover since launch, Li added.He warned, however, that Hong Kong could not take its role for granted, and needed to solve the social unrest currently gripping it."The city has yet to fully resolve some of the deep-seated political, social and economic tensions that have been building for many years. Some old, some new, some exacerbated since 1997. These are posing challenges to One Country, Two Systems, but it is only through the continued successful implementation of this framework that Hong Kong's future success can be ensured," he said.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.

  • Hong Kong Bourse Discusses New Listings With Ctrip, Netease
    Bloomberg

    Hong Kong Bourse Discusses New Listings With Ctrip, Netease

    (Bloomberg) -- Hong Kong Exchanges & Clearing Ltd. is discussing secondary listings with Chinese technology companies including Trip.com Group Ltd. and Netease Inc. after Alibaba raised $13 billion in its 2019 share offering in the city, according to people familiar with the matter.Bourse officials have held follow-up talks with the two U.S.-listed firms about the possibility of a secondary share sale, the people said, requesting not to be named because the matter is private. The discussions are preliminary and subject to change, they added.Hong Kong Exchanges & Clearing Ltd. has said it’s seeing a spike in inquiries about secondary listings from Chinese firms. The interest comes at a time when U.S. scrutiny of Chinese companies has intensified. A decision to proceed would see China’s biggest online travel service provider and second-biggest gaming company -- with a combined market value of about $60 billion -- follow in the footsteps of Alibaba Group Holding Ltd., which last year pulled off the financial hub’s largest equity offering since 2010.Hong Kong Exchanges’ shares rose 2.9% Thursday, their biggest gain in nearly four months. Trip.com, known also as Ctrip, climbed 10.2% to mark its biggest rise since March. And Netease stock surged 7.2%, the most since August, helped by a rally in Chinese technology stocks listed in New York.Read more: China Tech Inc. Straps in for Turbulence After a Wild 2019Ctrip and the Hong Kong exchange declined to comment in emailed statements. A Netease representative had no comment when contacted.Alibaba’s share sale marked a triumph for Asia’s largest stock exchange operator, which has lost many of China’s brightest technology stars to U.S. rivals. The city’s bourse introduced new rules to allow dual-class shares after initially resisting such a change, a move that had prompted Alibaba’s decision to debut in New York in 2014.More secondary listings from technology companies would bolster the Hong Kong exchange, which posted its worst profit drop in almost three years in the September quarter. The financial hub has also been shaken by months of anti-government protests, casting uncertainty over its 2020 prospects.Total fundraising from Hong Kong initial public offerings will drop by as much as 27% in 2020 to HK$230 billion ($29.5 billion), PwC estimated on Thursday. About 180 companies may debut, with more “new economy enterprises” to seek listings thanks to rule reforms.“More U.S.-listed Chinese concept stocks will come back to Hong Kong in 2020,” Benson Wong, a partner at PwC, said at a press briefing in Hong Kong. That trend will persist beyond next year, though it will be harder to see offerings on Alibaba’s scale, he added.Why Now, and Why Hong Kong, for Alibaba’s Share Sale?: QuickTakeA secondary offering in Hong Kong would help Chinese tech companies hedge their risks as U.S. tensions simmer. The Donald Trump administration is stepping up scrutiny against Chinese technology players beyond Huawei Technologies Co. Lawmakers have called for curbs on U.S. pension fund investments in the country’s companies.It could also help raise capital to tide them over an economic slowdown and increasing competitive pressure in 2020. Ctrip in particular has about $700 million worth of convertible bonds due in July. Its shares are trading at about $33.50, 38% below the agreed convertible price of $54, according to data compiled by Bloomberg.New tech debutantes like Alibaba will get a boost if they’re added to the benchmark Hang Seng Index and a stock connect program that allows mainland investors to buy shares in Hong Kong. Hang Seng Indexes Co. plans a consultation in the first quarter to discuss a raft of issues, including whether firms with weighted voting rights, like Alibaba, should be eligible for the HSI. Members of the stock connect program require reviews by the China Securities Regulatory Commission, the stock market watchdog.Read more: Alibaba’s Hong Kong Rally Is At Risk From Three Misconceptions(Updates with Ctrip and Netease gains in the fourth paragraph)\--With assistance from Kiuyan Wong and Zheping Huang.To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.netTo contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, Edwin ChanFor more articles like this, please visit us at bloomberg.com©2020 Bloomberg L.P.

  • With the global crown as world's No. 1 fundraising hub in its sight, Hong Kong stock exchange is chasing transaction volume
    South China Morning Post

    With the global crown as world's No. 1 fundraising hub in its sight, Hong Kong stock exchange is chasing transaction volume

    Now that it is on the cusp of regaining the crown as the world's leading initial public offering (IPO) market, the Hong Kong stock exchange is counting on some of its biggest stocks to attract sufficient trading to stave off competition from mainland bourses.That may be a tall order, as trading activity wanes amid political turmoil and mainland Chinese exchanges ramp up their efforts to keep listings of China's fastest-growing companies in their home markets.Hong Kong Exchanges and Clearing Limited (HKEX), which runs Asia's third-largest stock market, is on course to secure the coveted No. 1 spot for fundraising for an impressive seventh time in 11 years. The city is leading the world in fundraising this year, thanks largely to last month's US$12.9 billion secondary offering of Alibaba Group Holding, owner of the South China Morning Post. In all, 131 companies have raised a combined US$37.2 billion in the embattled financial hub, according to figures from data provider Dealogic. Saudi Aramco IPO boosts Tadawul bourse, but Hong Kong remains No 1 globallyThe Nasdaq and the New York Stock Exchange are ranked second and third, while Saudi Arabia's Tadawul exchange has leapt into fourth place from 25th following the US$25.6 billion sale by Saudi Aramco in the world's biggest ever IPO. In terms of IPOs and first time listings, Hong Kong is also ranked top with the Saudi bourse in second place, according to data tracker Refinitiv.Bulls including Haitong International Securities see HKEX as a long-term bet. They point to a cross-border investment channel linking Hong Kong and the mainland, known as the Stock Connect, that started in 2014, as a catalyst for the share price."I think the company has good long-term prospects," said Kevin Leung, executive director of investment strategy at Haitong International. "A shares are likely to perform well next year, so more people will be buying them through the Stock Connect, which is a good thing for HKEX."The Stock Connect, which gives overseas traders access to an array of the mainland's shares through HKEX, gained more popularity this year when index provider MSCI raised the weightings of the stocks in its global benchmarks three times to spur more foreign inflows. Net buying of Chinese stocks by foreign investors has exceeded 300 billion yuan (US$42.6 billion) in 2019, and is poised to surpass the total for the whole of last year.The investment scheme already accounts for about 6 per cent of HKEX's revenues, double the contribution two years ago.HKEX's share price has risen 16 per cent this year, more than double the gain on the Hang Seng Index. It added 2.2 per cent to HK$255.40 on Friday. The stock may climb 4 per cent in the next 12 months, according to the share-price estimates of analysts polled by Bloomberg.Out of the 19 analysts who cover HKEX in a Bloomberg poll, 12 including HSBC and Nomura rate the stock "buy", six are neutral and one recommends selling the stocks.The bourse's profit may increase 2.1 per cent from a year ago to HK$9.5 billion (US$1.2 billion) in 2019 and accelerate to 11 per cent growth next year, according to the estimates of analysts surveyed by Bloomberg.Still, to some analysts, that will not be enough to protect the HKEX's own share price from a combination of damaging headwinds."Daily trading volumes this year are down about 20 per cent from last year on average, which will be reflected in its share price," said Stanley Chan, director of research at Emperor Securities. "The IPO market will maintain its current level but won't be growing much next year. Overall the share price lacks a direction and is rangebound."The exchange has fallen indirect victim to six months of violent anti-government rallies that have dragged Hong Kong's economy into recession and tarnished the city's image as a global finance centre. As radical protesters have vandalised bank branches and forced the closure of some outlets at the height of the tensions, global investors have adopted a risk-off mood, fleeing the stock market and causing a slump in turnover.Fourth-quarter profit for HKEX will probably trail the consensus estimate of HK$2.07 billion by as much as 17 per cent and fall by 11 per cent from a year earlier, if the weak trading volumes extend to the rest of the year, Sharnie Wong, an analyst at Bloomberg Intelligence, said in a report this month.The average value of shares that changed hands in Hong Kong on a daily basis slid 10 per cent from a year ago in the early part of this quarter, while the daily volume of futures and options trading tumbled 30 per cent in October, she said.HKEX's current valuation may be too upbeat and not fully price in the risk of an earnings miss, according to the analyst. The stock trades at 29.2 times projected earnings, slightly higher than the average of 29.1 times for the multiple over the last six months.Forecasts for Hong Kong stocks in 2020 by major investment banks are not encouraging. Morgan Stanley says the Hang Seng Index may be the worst performer next year among the major gauges tracking China's onshore and offshore stocks because of the political crisis engulfing the city. Bocom International, the brokerage unit of Bank of Communications, predicts the city's benchmark will underperform the mainland's yuan-traded shares, known as A shares, as they gain more exposure to foreign buying."The biggest concern is that the Hong Kong market will be very quiet," said Louis Tse Ming-kwong, managing director of VC Asset Management. "People don't want to trade because they have low visibility in the global economy. There are quite a few uncertainties."On top of that, HKEX will probably find it more difficult to woo listings of fast-growing Chinese companies, as its mainland peers ramp up their efforts to keep those firms in their home market.The advantage bestowed by the Stock Connect may be eroded by the further opening-up of the mainland's exchanges, which have been seeking their own collaborations overseas.The Shanghai bourse kicked off a trading link with the London Stock Exchange in June, a similar cross-border investment channel to the Stock Connect, allowing Chinese companies to float depository receipts in the UK market. While only Huatai Securities and China Pacific Insurance have so far taken advantage, more such offerings in London will surely challenge HKEX's status as the hub for offshore trading of Chinese stocks.Mainland China's exchanges have also ratcheted up their campaign to retain domestic listings of the country's technology companies, potentially taking a major source of income away from HKEX. The Shanghai bourse in July launched the Science and Technology Board, also known as the Star market, which allows unprofitable companies to list for the first time on the mainland and gives investors more say in pricing new shares in the registration-based system for IPOs.These changes may also eventually be applied to the ChiNext market, a board that hosts hi-tech companies under the Shenzhen Stock Exchange."A plunge in stock trading activity and IPOs are among several factors weighing on the Hong Kong exchange's earnings that could linger into 2020," said Wong at Bloomberg Intelligence. "The political crisis in Hong Kong and mainland China's regulatory push to attract local technology IPOs on Shenzhen's ChiNext board and Shanghai's Star Market could deter new listings."This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.

  • Reuters

    Hong Kong's role in global finance remains intact despite months of protests: Fitch

    Hong Kong's role in global finance is intact, with little evidence to suggest recent protests and social unrest in the city have adversely impacted that role, global credit rating agency Fitch Ratings said on Thursday. The often violent protests have morphed into calls for greater democratic freedoms and an end to alleged mainland Chinese meddling in the semi-autonomous former British colony.

  • Alibaba’s Hong Kong Rally Is At Risk From Three Misconceptions
    Bloomberg

    Alibaba’s Hong Kong Rally Is At Risk From Three Misconceptions

    (Bloomberg) -- Alibaba Group Holding Ltd.’s landmark $11 billion share sale and listing in Hong Kong on Nov. 26 was galvanized by expectations the Chinese e-commerce giant will attract a vast pool of capital from its home country. But some investors caution against unrealistic expectations, especially by mainland investors, and highlight certain restrictions that still govern -- and potentially curtail -- trading activity in Alibaba’s Hong Kong shares.The company’s sheer size and the unprecedented nature of its secondary listing (the primary listing is still in New York) and unique management structure present challenges for investors hoping to gauge everything from Alibaba’s inclusion in indexes -- crucial because they direct the flow of capital from tracker funds -- to its listing status.Here’s what we know.1\. Will Alibaba get added to the Hang Seng Index?Not right now. Alibaba will be added to Hang Seng Composite Index on Dec. 9, but it isn’t qualified to join the benchmark Hang Seng Index or the Hang Seng China Enterprise Index because they comprise only primary listings and corporations without so-called weighted voting rights (WVR).Membership of the 50-member Hang Seng is coveted by corporations because it could trigger billions of dollars of inflows from funds tracking the 50-year-old gauge. Hang Seng Indexes Co. plans a consultation in the first quarter to discuss issues including whether firms with weighted voting rights, like Alibaba, should be eligible for the HSI. Any conclusions should be published by May, Daniel Wong, its head of research and analytics, said in a statement. Even if the index compiler decides to overhaul its rules, the required process means it may not be until late 2020 before Alibaba could join the major Hang Seng benchmarks.Representatives for HKEx and Alibaba declined to comment.Read more: Why Now, and Why Hong Kong, for Alibaba’s Share Sale?: QuickTake2\. Will Alibaba be included in the stock connect program?Maybe, but a lot hinges on policy makers. China doesn’t spell out criteria or qualifications for joining the program, which allows mainland investors to buy stocks listed in Hong Kong. Unlike the HSI, the program isn’t limited to primary listings. It does require review by the China Securities Regulatory Commission, the stock market watchdog.The first companies in stock connect with weighted voting rights were Meituan Dianping and Xiaomi Corp., which mainland investors got access to in late October through the program. That’s after similarly structured Chinese firms started listing in July on Shanghai’s new tech-focused Star board. Many investors expect Beijing to ultimately allow Alibaba’s Hong Kong shares to trade through the stock link with the city as well.But it may not necessarily be in China’s best interest to do so. That’s because other U.S.-listed Chinese firms -- among the country’s largest corporations, from JD.com Inc. to Baidu Inc. -- may be encouraged to follow in Alibaba’s footsteps and conduct their own secondary listings in Hong Kong, bypassing the Shanghai or Shenzhen bourses. That may run counter to Beijing’s longstanding ambitions of developing healthy, vibrant mainland exchanges, particularly as unrest grips Hong Kong.3\. Can Alibaba change its primary listing to Hong Kong?It’s possible -- thereby attracting investors with a preference for main listings, and at the same time scoring brownie points with some in Beijing who could view that as supporting China’s policy ambitions. Alibaba was given the green light to list in Hong Kong based on a new “Secondary Listing” rule, or Chapter 19C. It allows companies to conduct follow-on share offerings without complying with more stringent rules laid down by Hong Kong Exchanges & Clearing Ltd. governing first-time listees.Alibaba may enjoy special status in having more freedom to comply with Hong Kong listing requirements. Under rules laid out in a consultation paper in April last year, Chinese firms that went public before Dec. 15, 2017 don’t need to comply with “WVR” safeguards if they later switch their primary listing to Hong Kong. Alibaba, which debuted in New York in 2014, said in its Hong Kong listing prospectus it’s a “WVR” company similar to Meituan and Xiaomi.Meanwhile, Alibaba employs a fairly unique structure in which a group of partners have the right to nominate a majority of the firm’s board -- exerting outsized influence on Alibaba’s direction.In addition, Hong Kong listing rules say if trading volume there exceeds 55% of global turnover over an entire fiscal year, the stock has to adopt primary listing status in Hong Kong. HKEx gives such Chinese companies a year to comply. But with Hong Kong’s stock registration office listing just 23% of outstanding Alibaba shares as of Nov. 28, a majority of trading volume occurring there may be a tall order.\--With assistance from Paul Geitner and Fox Hu.To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.netTo contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net, Edwin Chan, Kevin KingsburyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters

    UPDATE 1-Shanghai exchange plans international copper contract for 2020

    SHANGHAI/LONDON, Dec 2 (Reuters) - The Shanghai International Energy Exchange (INE) plans to launch a copper contract next year that will open the door to foreign investors wanting to hedge exposure in China, the Shanghai Futures Exchange said on Monday. China is the top global consumer of raw materials and has some of the world's most liquid commodities futures markets, but foreign companies have limited access to these markets. The Shanghai Futures Exchange (ShFE), which owns INE, currently offers a copper futures contract, but it is not open to foreign participation and is subject to value-added and import taxes.

  • Alibaba’s Strong Hong Kong Debut Fuels Broader Ambitions
    Bloomberg

    Alibaba’s Strong Hong Kong Debut Fuels Broader Ambitions

    (Bloomberg) -- Alibaba Group Holding Ltd. rose 6.6% in its Hong Kong debut, fueling the ambitions of China’s largest internet company as well as an Asian city rocked by violent anti-government protests.Chairman Daniel Zhang, lieutenants wearing Alibaba lapel pins and Hong Kong dignitaries were on hand to strike the opening gong Tuesday at a celebration of the city’s biggest stock listing this year. The company presented a Chinese-style painting to the exchange -- a souvenir to go with the showy coming-out party. The Chinese e-commerce giant’s shares rose to HK$187.60, versus a HK$176 issuance price. They traded under the code 9988 -- auspicious numbers in Chinese culture that signify prosperity.Asia’s most valuable corporation raised about $11 billion in the financial hub’s largest issuance of stock since 2010, a triumph for a stock exchange that over the years lost many of China’s brightest technology stars to U.S. rivals. Now, the blockbuster debut by one of China’s most successful companies signals confidence in Hong Kong’s future even as pro-democracy protests grip the city, earning Alibaba goodwill in Beijing. It makes it easier for investors in the mainland to buy and sell Alibaba shares, which are primarily listed in New York.It’s also a homecoming for Alibaba, whose decision to hold its $25 billion initial public offering five years ago in New York dealt a blow to Hong Kong’s ambitions. Listing closer to home has been a long-time dream of billionaire co-founder Jack Ma’s. More broadly, his company has been trying to sustain growth at a time the engines of China’s economy are sputtering. Like fellow internet giant Tencent Holdings Ltd., Alibaba’s exploring new markets as China clashes with the U.S. over everything from trade and technology to investment.“We came home. We came back to list in Hong Kong,” Zhang said to applause. “It helped make up for our regret five years ago.”Why Now, and Why Hong Kong, for Alibaba’s Share Sale?: QuickTakeA marquee name like Alibaba’s could draw investors and boost trading liquidity for Hong Kong Exchanges & Clearing Ltd., which just saw its biggest profit slump in more than three years following a failed bid to buy its London counterpart in September. Efforts to court Alibaba emanated from the very top, with Chief Executive Carrie Lam, Hong Kong’s leader, herself lobbying Ma.The Chinese company’s decision to forge ahead despite a recent escalation in protest-related violence pleased officials trying to persuade the world that the troubled city still has a future as a financial hub. Alibaba’s sale could tempt Chinese tech unicorns from Didi Chuxing Inc. to ByteDance Inc. to opt for Hong Kong over the U.S. if they eventually go public.“Alibaba will be the leading light for bringing more companies in,” Andrew Sullivan, a director at Pearl Bridge Partners, told Bloomberg Television. “You may see some new money being allocated. The keen competitor is going to be Tencent, which has historically traded at a premium.”The new funds now help Alibaba finance a costly war against homegrown rivals nipping at its heels. It could swell the company’s cash pile to about $44 billion, more than any other internet company and roughly double that of arch-rival Tencent’s. The capital could bankroll competition with Tencent and Baidu Inc. in cloud computing and entertainment, with Meituan Dianping in food delivery and travel, and with everyone in terms of investing in promising startups that yield technology, talent or market share. And it could divert investor cash from those rivals -- Alibaba is now the largest corporation to be listed in Hong Kong, pipping Tencent for the title.Demand for Alibaba’s stock surpassed supply by several times and more shares were allocated to small investors. It’s a feather in the cap for Zhang, who took over as chairman from Ma in September. The former accountant is now spearheading the company’s expansion beyond Asia as well as into adjacent business lines from cloud computing to entertainment, logistics and physical retail.Alibaba could put the capital to work investing in new technologies such as artificial intelligence, or fast-expanding affiliates such as Ant Financial. Courting investors closer to home also serves as a buffer of sorts should U.S.-Chinese tensions worsen. Already, U.S. lawmakers such as Senator Marco Rubio are agitating for measures to curb investment flows to Chinese companies, including the extreme option of tossing U.S.-listed firms off American bourses.Read more: Alibaba’s Sales Jump 40% Despite Cooling China Economy(Updates with share action from the first paragraph.)To contact the reporters on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net;Kiuyan Wong in Hong Kong at kwong739@bloomberg.netTo contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net, Edwin Chan, Vlad SavovFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters

    EXPLAINER -Why is Alibaba listing in Hong Kong?

    Chinese e-commerce giant Alibaba is set to price its first share sale in Hong Kong next week, raising up to $13.4 billion in what will be the largest deal in the city since 2010 and the world's biggest ever cross-border secondary listing. WHY IS ALIBABA LISTING IN HONG KONG? Alibaba, which is due to start trading on Nov. 26 in Hong Kong, could also benefit from Chinese demand.

  • Alibaba Launches Mega Share Sale With $12 Billion Retail Tag
    Bloomberg

    Alibaba Launches Mega Share Sale With $12 Billion Retail Tag

    (Bloomberg) -- Alibaba Group Holding Ltd. priced the retail portion of its Hong Kong share sale Friday, issuing an appeal to individual investors in a city in the throes of recession after months of violent pro-democracy protests.The largest Chinese e-commerce company capped the 12.5 million shares available to individual investors at HK$188 apiece -- an auspicious number in Chinese culture -- making it the most expensive first-time share sale in Hong Kong. Alibaba said it may price the remainder of its 500 million-share offering above that ceiling, signaling that it aims to raise at least $12 billion in what would be one of the world’s largest sales of stock this year. The company will price the rest of its international offering by Nov. 20.Asia’s largest corporation is proceeding with what could be Hong Kong’s biggest share sale since 2010. Slated for late November, it’ll be the Chinese e-commerce juggernaut’s official Asian coming-out party -- half a decade after snubbing the financial hub for a record Wall Street debut. Alibaba’s return hands a much-needed victory to a city wracked by protests since the summer, and will please Chinese officials who’ve watched many of the country’s largest private corporations flock overseas for capital. If the deal goes through, Alibaba will challenge Tencent Holdings Ltd. for the title of the largest Hong Kong-listed corporation.“The listing in Hong Kong will allow more of the company’s users and stakeholders in the Alibaba digital economy across Asia to invest and participate in Alibaba’s growth,” the company said. “During this time of ongoing change, we continue to believe that the future of Hong Kong remains bright,” Daniel Zhang, chief executive officer of Alibaba, said in a letter to investors.Read more: Alibaba Is Taking Orders for $11 Billion Hong Kong ListingListing closer to home has been a long-time dream of billionaire Alibaba co-founder Jack Ma’s. A successful Hong Kong share sale could help finance a costly war of subsidies with Meituan Dianping in food delivery and travel, and divert investor cash from rivals like Meituan and WeChat operator Tencent. It will also be a feather in the cap for Zhang, who took over as chairman from Ma in September. The former accountant is now spearheading the company’s expansion beyond Asia but also into adjacent markets from cloud computing to entertainment, logistics and physical retail.What Bloomberg Intelligence SaysAlibaba’s secondary listing in Hong Kong could lead to a shake up of the Hang Seng Index, the city’s main stock benchmark. The 50-member index is heavy on financial stocks, when comparing weights to other leading equity indexes in the world. Meanwhile, IT, industrials and consumer discretionary stocks are severely underrepresented.\- Steven Lam, analystClick here for the researchA marquee name like Alibaba’s could draw investors and boost trading liquidity for Hong Kong Exchanges & Clearing Ltd., which just incurred its biggest profit slump in more than three years. For Hong Kong, it’s bit of welcome news following half a year of often violent protests that have at times paralyzed the city and its service industry. Efforts to court Alibaba emanated from the very top, with Chief Executive Carrie Lam herself exhorting Ma to consider a listing in the city.Alibaba has considered a Hong Kong listing for a long time, Michael Yao, head of corporate finance at Alibaba, said on a call with investors this week. The deal size hasn’t changed as a result of the protests, he added.(Updates with details of price per share comparison in second paragraph)\--With assistance from Zhen Hao Toh.To contact the reporters on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net;Alistair Barr in San Francisco at abarr18@bloomberg.netTo contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net, Edwin Chan, Colum MurphyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • HKEX's third-quarter profit beats estimates even as turnover, fundraising were hit by protests
    South China Morning Post

    HKEX's third-quarter profit beats estimates even as turnover, fundraising were hit by protests

    Hong Kong Exchanges and Clearing on Wednesday reported a better than expected 10 per cent decline in net profit during the third quarter even as stock market turnover and fundraising activity fell due to unprecedented anti-government protests.HKEX, which operates Asia's third-largest stock market and owns the London Metal Exchange (LME), said that its July to September quarter net profit stood at HK$2.2 billion (US$280 million), down from HK$2.44 billion a year earlier. On a quarterly basis, net profit declined by 15.4 per cent from HK$2.6 billion in the April to June period before the city was hit by violent protests.Its earnings per share of HK$1.76 per share beat market forecasts of HK$1.6, according to analysts polled by Bloomberg.Its third-quarter revenue fell 6 per cent year on year to HK$3.34 billion, again beating consensus estimates of a 10 per cent drop.Charles Li Xiaojia, chief executive of Hong Kong Exchanges and Clearing, said the bourse operator had a good nine months despite geopolitical challenges. Photo: Jonathan Wong alt=Charles Li Xiaojia, chief executive of Hong Kong Exchanges and Clearing, said the bourse operator had a good nine months despite geopolitical challenges. Photo: Jonathan WongThe third quarter was disappointing for the HKEX chief executive Charles Li Xiaojia. Besides the lower turnover and fewer initial public offerings, he also failed in his £29.6 billion (US$38.12 billion) bid to buy the London Stock Exchange launched on September 11, as it was rejected by the board of the London bourse."We were disappointed not to proceed with a firm offer for LSEG (London Stock Exchange Group), but we remain resolutely focused on the successful execution of our three-year strategic plan, maintaining good cost discipline and capturing future growth opportunities," Li said in the results statement. Hong Kong edges past Nasdaq as the world's third-quarter IPO hub"Set against a challenging broad geopolitical backdrop, HKEX has had a good first nine months of 2019. Record stock connect revenue, recent resurgence in the IPO market and good returns from investment income offset some macro-driven softness in cash market volumes.For the first nine months of this year, HKEX's net profit fell 1 per cent to HK$7.41 billion from HK$7.48 billion a year earlier.According to Bloomberg's consensus estimates, the exchange may find it hard to achieve its full-year net profit growth of 2 per cent to HK$9.48 billion if the protests continue. "The stock market turnover has gone down and so has the trading fee and settlement fee incomes. This has hurt the stock exchange's profit outlook," said Gordon Tsui Luen-on, chairman of Hong Kong Securities Association.The average daily turnover in the third quarter dropped 16 per cent year on year to HK$77 billion, while the nine-month turnover stood at HK$90.5 billion, a 21 per cent decline from HK$114.7 billion a year earlier, according to HKEX data.Listing fee fell by 10 per cent during the quarter as the amount raised from IPOs plummeted by 63 per cent to US$7.13 billion " the lowest in two years, according to financial data provider Refinitiv. The number of IPOs also decreased to 22 from 52 a year earlier."However, the Hong Kong IPO market has become active again since September after the market sentiment improved. Hong Kong still has a chance to beat New York to reclaim the crown as the No. 1 IPO market worldwide for the full year," Tsui said.China Feihe, whose baby milk formula is endorsed by actress Zhang Ziyi, completed its IPO on Wednesday. It is expected to raise up to US$1.14 billion if it can price its shares at the top end of the range, making it the third-largest IPO this year and the fourth IPO to raise more US$1 billion over the past two months. The offering is only less than Budweiser Brewing Company APAC's US$5.8 billion IPO in September and ESR Cayman's US$1.6 billion last month. Chinese sportswear manufacturer Topsports International Holdings also raised US$1 billion last month.Hong Kong Exchanges and Clearing owns the London Metal Exchange. Photo: AFP alt=Hong Kong Exchanges and Clearing owns the London Metal Exchange. Photo: AFPTurnover of metals contracts on the LME fell 4 per cent in the first nine months of the year to 618,000 lots.  Meanwhile, the two stock connect schemes continue to bring additional revenue to the exchange. The average daily turnover from northbound trading " which refers to trading of A shares listed in Shanghai and Shenzhen via the HKEX " reached US38.5 billion, the second-highest quarterly turnover. The turnover via the connect schemes during the first nine months had doubled from a year earlier after major index compilers MSCI and FTSE Russell added the mainland traded shares to their benchmark indices.HKEX's costs during the first nine months fell 1 per cent to HK$2.9 billion as a result of a change to the accounting standard treatment on lease. If the effect is stripped, expenditure rose 6 per cent during the period due to higher staff and IT costs. HKEX shares closed 0.72 per cent higher at HK$252 on Wednesday after the result announced at lunch break.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.

  • Hong Kong bourse logs biggest quarterly profit fall in 3 years on protests
    Reuters

    Hong Kong bourse logs biggest quarterly profit fall in 3 years on protests

    Hong Kong's stock exchange operator said quarterly profit dropped 8%, the steepest slide in nearly three years, as investor sentiment was hit by months of political unrest that pushed the Asian financial hub into recession. Hong Kong's Hang Seng index declined 8.6% during the quarter to end-September, marking its worst quarter in four years. While Hong Kong's pro-democracy protests show no signs of abating, the exchange's earnings could be bolstered by a pick up in IPOs in the fourth quarter.

  • Reuters

    LMEWEEK-Exchanges looking at new steel scrap contract-Mettalex head

    Startup steel trading firm Mettalex is in talks with exchanges about launching a new scrap contract focused on Asia, the firm's head said on Wednesday. Growing trade in steel scrap delivered in containers is ripe for a derivative, said Phillip Price, managing director of Mettalex which has its official launch on Friday. "We are big believers in the idea of a containerised scrap derivative product for south or east Asia.

  • Reuters

    Chinese biotech Alphamab seeks approval for HK IPO of up to $350 mln -sources

    Chinese biopharmaceutical company, Alphamab Oncology, plans to seek listing approval early next month for a Hong Kong initial public offering (IPO) of up to $350 million, people with direct knowledge of the matter said. Alphamab plans to carry out a deal roadshow and go public by the end of the year, the people added, as the Asian financial hub gets back into business after a freeze in recent months amid frequently violent anti-government protests. The company, backed by Hong Kong-based investment firm PAG, has appointed CLSA, Jefferies Financial Group and Morgan Stanley as sponsors to its IPO - a deal that has been in the planning stages for at least five months.

  • Reuters

    HKEX CEO says "fundamental flaws" in HK's system of governance

    Hong Kong bourse Chief Executive Charles Li said there are fundamental flaws in the "one country, two systems" formula that govern the former British territory. The comments by Li mark a rare public condemnation from a senior Hong Kong business executive of the Beijing-backed administration under which the territory is ruled at a time when it is grappling with its biggest political crisis in decades. "The great concept, the great creation of one country, two systems is really, has some fundamental flaws at the very beginning of the implementation," he said.

  • Reuters

    LMEWEEK-LME's planned lithium committee to include Tesla and Albemarle

    The London Metal Exchange (LME) said on Tuesday it would create a committee to represent the interests and views of producers and users of lithium, a key ingredient in batteries. The LME said the committee was likely to include representatives of nine companies including vehicle makers Tesla and Jaguar Land Rover and lithium producers and processors Tianqi Lithium Australia, BASF and Albemarle. The LME plans a lithium contract, but has given no timeline for an official launch.