Asian bourses were mixed on Monday, with China markets outperforming the region after a new launch date was announced for an anticipated cross-border trading link with Shanghai.
Hong Kong’s bourse operator jumped 4.2 percent to HK$182.90 as of 9:35 a.m. in the city, set for the steepest gain since April 11, when the trading link was first announced. Hong Kong Exchanges & Clearing Ltd., the best performing stock this year on the benchmark Hang Seng Index, surged today gaining 1.8 percent. Citic Securities Co. advanced 3 percent to HK$20.10, while China Galaxy Securities Co. added 4.4 percent to HK$6.85.
Debut Next Week
The exchange link between Hong Kong and Shanghai will debut in a week, regulators said in a joint statement today, giving foreign investors unprecedented access to China’s $4.2 trillion equity market. The start date had been expected last month after HKEx head Charles Li said the program would likely kick off on a Monday in October.
“The street has been waiting since the April announcement, and brokers have been ready since October 27th,” said Gavin Parry, managing director of Parry International in Hong Kong. “This is a sentiment positive for Hong Kong.”
The Shanghai-Hong Kong Stock Connect permits international money managers to purchase a net 13 billion yuan ($2.1 billion) a day of Chinese shares, while also providing a route for mainland investors to buy Hong Kong equities.
Chinese October trade data over the weekend was also in focus. Exports rose 11.6 percent, above forecasts but slowed from a 15.3 percent jump in September. Meanwhile, imports increased an annual 4.6 percent, pulling back from a 7 percent rise in September.