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The Hong Kong stock exchange operator has achieved the best quarterly profit ever as a result of trade floods and the initial public offering boosted the stock market before it took over the new CEO.
Hong Kong Exchanges and Clearing said on Wednesday that post-tax earnings fell by 70 per cent a year in the first quarter to HK $ 3.8 billion (US $ 490 million) in turnover and list-based core business revenues rose by more than a third to record HK $ 5.5bn. Investment income earned $ 418 million from a loss in the first quarter of 2020.
The stock market’s first-quarter performance benefited from a range of high-end IPOs made by Chinese technology companies, including the short video platform Kuaishou. It has raised more than $ 5 billion in February.
Chinese groups trading in New York have increased their share of large-income sales in Hong Kong this year. Technology teams Baidu and Bilibili as prepared by U.S. regulators who were among the companies that launched secondary listings in the city groups that are forcibly removed those who did not meet home accounting requirements.
“HKEX is off to a strong start in 2021,” he said Calvin Tai, interim CEO, “who has pointed to a strong IPO market and very strong trading volumes… placed in front of an economic and geopolitical background”.
HKEX shares, which have doubled in the past 12 months, have changed little in the afternoon after the announcement of results in trading in Hong Kong.
It has been Hong Kong’s position as an Asian financial hub question last year Beijing imposed a draconian law on national security for the city.
But efforts to internationalize exchanges in Shanghai and Shenzhen have long been a concern for HKEX only limited progress. Washington’s growing hostility to China has strengthened Hong Kong’s role as an offshore collection center for Chinese companies.
“Hong Kong is still a maritime market for mainland China. Close to the coast but still close to the coast, “an HKEX insider said. The Shanghai exchange” internationalization plans are unlikely to harm Hong Kong, as the internal market lacks capital convertibility for companies seeking to collect non-offshore renminbi currencies. “
HKEX’s profits also increased as investors from mainland China traded in Shanghai and Shenzhen take out stocks Through the so-called stock connect programs in the Hong Kong market.
HKEX reported an average daily turnover of nearly $ 61 billion through continental investors in the first three months of 2021, helping to bring the total daily turnover of the exchange to a record $ 224 billion.
International investors also traded through programs linked to Chinese equities and bonds, reaching a daily high of Rmb127bn (US $ 20bn) and Rmb25bn, respectively.
But Louis Tse, chief executive of Wealthy Securities brokerage, said turnover fell in the early second quarter as investors from the mainland cooled and Beijing faced Chinese technology groups, many of them trading in Hong Kong.
“The [record regulatory] The Alibaba penalty has sent a shock wave through technology stocks, “Tes said.” This has cooled the speculative mood in the market and eased turnover. “
Tai, the interim chief executive, was in charge of the playoffs after the departure former Charles Li, played a role for a decade and launched stock and bond connect programs.
Nicolas Aguzin is a former banker at JPMorgan to take power HKEX in May.
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