The Shanghai Stock Exchange said it is hammering out the details of its long-planned international board. Its chairman Geng Liang said Wednesday: “We are actively preparing the launch of the international board, but there’s no timetable.” A number of companies with extensive operations in China, including HSBC, and quite a few Hong Kong blue-chip firms such as Bank of East Asia and Hutchison Whampoa, have said they want to list their shares on the international board.
Originally it was planned to launch the International Trade Board in 2010, which would allow foreign companies to sell shares denominated in the Chinese currency RMB. It was said it would help SSE to raise up to RMB300 billion ($43.95 billion) through initial public offerings in 2010.
Hong Kong Stock Exchange is going to align itself with market operations in mainland China. Starting from March 7, 2011, it will have five hours to trade stocks. The present schedule is from 10 am until noon and then 2:30-4 pm. Under the first phase of adjusting the schedule, trading days will start at 9:30 am, break for lunch at noon, and then resume trading at 1:30 pm until 4 pm.
Credit Suisse’s economist Dong Tao said China’s domestic stock market has become increasingly speculative, as some people have started taking their apartments as collateral to fund leveraged plays. The A-share market has risen 16% since September, marking one of best two-month performance in the 19-year history of China’s young stock market. Last week alone, there were 387,663 new trading accounts opened and the total active trading account reached 22.2 million – both are at their highest level since 3Q 2007 before the A-share market crashed from its peak of 6,396 point. Tao said excess liquidity and a stagnant property market have made the stock market the best place for speculation. The daily turnover of the Shanghai A-share market reached CNY 236 billion (US$35.4 bn) in October, which is the combined turnover for all the major exchanges in non-Japan Asia (including Hong Kong, Korea, Taiwan, India, etc.). Over the past years, when the daily turnover/market cap ratio exceeded 1.5%, the A-share index would usually soon start turning south and enter a period of consolidation, Tao warned.
According to a report by Etnet, HKEx Head of Listing Mark Dickens said that the bourse is planning to relax the limitations imposed on secondary listing or HDR issuance in Hong Kong for overseas companies. However, this relaxation will not include mainland listed companies. Dickens said the HKEx intends to differentiate the requirements for first-time and secondary listing in the future. A more strict standard will be adopted for IPO and first -time HDR issuance in Hong Kong while companies applying for secondary listing can enjoy more relaxed minimum requirements.
China securities regulator has given the green light for Shanghai to establish China mainland’s second over-the-counter market, creating a new equity trading platform for unlisted start-up firms. Fang Xinghai, the director-general of Shanghai’s financial services office, told a media briefing yesterday that the market would be launched at the Zhangjiang Hi-Tech Park in Pudong with 36 start-up companies lining up to be traded.
