Global Impact: Hong Kong’s stock market eyes light at the end of the tunnel after 3 years in the doldrums

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world

In this week’s issue, we reflect on what is in store for Hong Kong’s stock market and its operator, the Hong Kong Exchanges and Clearing Limited (HKEX), in the Year of the Dragon

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Bonnie Chan Yiting, chief executive officer of Hong Kong Exchanges & Clearing Ltd. (HKEX). Photo: Bloomberg

Published: 2:00pm, 18 Mar 2024Updated: 12:49pm, 22 Mar 2024

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On Valentine’s Day, eight multicoloured lions carried out a boisterous dance around a ceremonial gong at Hong Kong’s stock exchange to mark the first trading day of the lunar calendar’s Year of the Dragon.

Chairwoman Laura Cha Shih May-lung and Financial Secretary Paul Chan Mo-po kicked off the day’s transactions by striking the gong with mallets wrapped in red cloth, watched by a congregation of the city’s top financial officials.

The occasion was also a prelude to a carefully calibrated changing of the guard at Hong Kong Exchanges and Clearing Limited (HKEX).

Nicolas Aguzin, the former JPMorgan private banker who took over in 2021 as chief executive, would hand over the reins two weeks later. Cha, the first woman to chair HKEX, is also scheduled to retire in late April during the exchange’s annual meeting, at which her successor is expected to be revealed.

The transition serves as a bookend to one of the most tumultuous periods for the exchange. Three years of the coronavirus pandemic led to an economic slump in Hong Kong and mainland China, which sapped consumption and hammered corporate earnings.

Global capital rushed to Wall Street after the US Federal Reserve raised its key interest rate by five percentage points from 2022, and initial public offerings (IPOs) slowed to a trickle in Hong Kong.