GMT EIGHT - Hong Kong & MaCao

The Securities and Futures Commission of Hong Kong and its counterparts in Asia have reached a consensus on the regulatory direction of sustainable development, technology, and investor protection.

On February 21, during the regional committee meeting organized by the International Organization of Securities Commissions (IOSCO), the Securities and Futures Commission of Hong Kong (SFC) hosted discussions among securities regulatory agencies in the Asia-Pacific region to promote consensus on a wide range of capital market issues. Ms. Ashley Alder, the Chief Executive Officer of the SFC, and Ms. Nathalie De Basaldua, Director General of the Directorate-General for Financial Stability, Financial Services, and Capital Markets Union, co-chaired the EU-Asia-Pacific Financial Regulatory Forum. Financial regulators and senior officials from Europe and the Asia-Pacific region discussed the latest developments in financial supervision and regulation in the digitalization, fintech, and sustainable finance areas. The Asia-Pacific Regional Committee of IOSCO, chaired by Ms. Alder, held a three-day meeting in Vietnam from February 19 to 21, 2025, to facilitate collaboration on shared topics of interest. Members agreed to adopt coordinated regional policies to address fraud and cyber threats, and to share experiences and technologies related to detecting and investigating investment fraud, as well as leveraging technological innovations to address emerging issues. During her visit, Ms. Alder met with Ms. Vu Thi Chan Phuong, Chairman of the State Securities Commission of Vietnam, to discuss regulatory cooperation, cryptocurrency regulation, and common concerns related to capital markets. She welcomed the State Securities Commission of Vietnam as the 14th and latest signatory of the Multilateral Memorandum of Understanding of the Asia-Pacific Committee on Multilateral Supervisory Cooperation. The signing ceremony of the Memorandum of Understanding was witnessed by the Minister of Finance of Vietnam, Mr. Nguyen Van Thang. In her keynote address at the seminar organized by the State Securities Commission of Vietnam, Ms. Alder stated, "The Asia-Pacific Committee provides a valuable platform for securities regulatory agencies in the region to establish consensus and cooperation on cross-border issues, which is crucial for enhancing global trust in the growing capital markets of the Asia-Pacific region. By sharing insights and promoting cooperation, every one of us present here today can learn about emerging trends, evaluate risks, and identify key actions to better address the current complex landscape." Prior to this, senior executives from the SFC participated in the meetings of the Enforcement Directors and Inspection Directors of the Asia-Pacific Committee, exchanging experiences and sharing views on a range of topics. These topics included priorities and trends in enforcement work, the use of technology for regulatory duties, the rise and use of generative artificial intelligence in the financial industry, and regulatory policies regarding custody of virtual assets.

21/02/2025

Macau: January CPI rose by 0.57% year-on-year and 0.17% month-on-month.

According to the data from the Statistics and Census Bureau of Macao, in January 2025, the composite consumer price index in Macao increased by 0.57% year-on-year and by 0.17% month-on-month. In the twelve months leading up to January of this year, the average composite consumer price index rose by 0.7% compared to the same period a year ago (from February 2023 to January 2024). Compared to January 2024, the price indices for leisure, sports and culture, miscellaneous goods and services (including personal care, insurance, jewelry and watches, etc.), and medical categories have significantly increased by 5.36%, 2.68%, and 1.1% respectively. Prices for dining out, food delivery charges, and housing rents have increased, leading to increases in the food and non-alcoholic beverage category (+0.88%) and housing and fuel category (+0.27%). On the other hand, prices for information and communication (-2.84%), clothing and footwear (-2.22%), and transportation (-1.23%) categories have decreased. The Class A and Class B consumer price indices increased by 0.47% and 0.63% respectively year-on-year. Compared to December 2024, the composite consumer price index in January rose by 0.17%, with the leisure, sports and culture category (+2.74%) showing the largest month-on-month increase. Additionally, the food and non-alcoholic beverage category, which is of more concern to the general public, also increased by 0.55%, mainly due to increases in dining out and food delivery charges, as well as rising prices for fresh fish, seafood, and fruits. The transportation category (+0.38%) was also affected by the increase in airfare prices. On the other hand, the information and communication (-2.44%) and clothing and footwear (-1.94%) categories recorded decreases in prices month-on-month. The Class A and Class B consumer price indices increased by 0.14% and 0.19% respectively month-on-month. In the twelve months leading up to January of this year, the average composite consumer price index rose by 0.7% compared to the same period a year ago, with education (+3.17%), miscellaneous goods and services (+2.58%), leisure, sports and culture (+2.19%) and medical (+2.14%) categories recording the largest increases, while the price index for transportation (-3.01%) decreased. The Class A and Class B consumer price indices increased by 0.66% and 0.75% respectively. The Statistics and Census Bureau of Macao has compiled three series of consumer price indices to reflect the impact of changes in prices of goods/services on households in different expenditure groups. The Class A and Class B consumer price indices cover approximately 50% and 30% of households, with average monthly expenditures ranging from 11,000 to 35,999 Macao Patacas and 36,000 to 71,999 Macao Patacas respectively. The composite consumer price index covers all households mentioned above; with housing and fuel, food and non-alcoholic beverages, and transportation categories accounting for a higher proportion of household expenditures, with weights of 34.47, 29.47, and 8.33 respectively.

21/02/2025

Hong Kong Exchanges and Clearing Limited: Cancellation of minimum and maximum fee limits for share settlement fees.

On February 21st, HKEX announced that they will optimize the securities market share settlement fee structure to improve market efficiency and ensure that the fees are closely linked to the trading amount. HKEX will eliminate the minimum and maximum fee limits for share settlement fees and adjust the fee rate to 0.42 basis points (0.0042%) per transaction. The new fee structure aims to ensure that there is no increase in overall market expenses and balance the cost for all trading sizes. In addition, the share settlement fee rate for eligible market makers trading exchange traded products (ETP) will be adjusted to 0.20 basis points (0.0020%) and the minimum and maximum fees will be eliminated. The adjusted fees for ETP market maker activities will be similar to the past costs to ensure that the ETP market continues to have sufficient liquidity. According to HKEX's data, under the new fee structure, around 77% of market transactions between 2019 and 2024 will pay lower fees. HKEX's Chief Operating Officer and Group Chief Financial Officer, Laura Cha, said, "HKEX is committed to providing a vibrant and efficient market for global investors. We are pleased to optimize the share settlement fee structure, making the fees clearer and more consistent, fairer for trades of different amounts, and allowing retail and institutional investors to execute their trading strategies more flexibly. This adjustment is also one of our efforts to increase the depth and breadth of the securities market, solidifying Hong Kong's position as a leading international financial center." The new fee structure has been approved by the Securities and Futures Commission of Hong Kong and will be implemented in June 2025 after the market is ready, and before the first phase of narrowing the bid-ask spread. Narrowing the bid-ask spread may lead to more smaller trades, benefiting investors from the new fee structure.

21/02/2025

Country Garden: CCL fell 0.78% last week, the largest weekly decline since the interest rate cut, and Hong Kong property prices are under pressure again.

Yang Mingyi, Senior Co-Chairman of the Research Department of China Real Estate, pointed out that the latest China City Leading Index (CCL) was 137.39 points, a decrease of 0.78% weekly, reflecting the market conditions during the Lunar New Year long holiday and the week when the Federal Reserve maintained interest rates on January 30th. During the Chinese New Year holiday, the second-hand property market in Hong Kong was quiet, the US slowed down its rate cuts, and the market sentiment was cautious. The CCL dropped below the 138-point level, hitting a nearly 8-week low, with the largest decline in 20 weeks since the rate cut in September last year. This week, all eight major property price indices in Hong Kong fell, the first time in 23 weeks, after three months of stagnation. Next Wednesday (February 26), when the financial budget is announced, if there are measures to stimulate the property market, the CCL may have the potential to bottom out and rebound by late March. The CCL is at its lowest level in nearly 8 and a half years, hovering around the level in the middle of September 2016. Property prices have turned from rising to falling in 2025, with a cumulative decline of 0.18% for now. Compared to the low point of 135.86 points before the first rate cut in September 2024, the index has risen by 1.13%, but it has fallen by 28.20% from the historical high point of 191.34 points in August 2021, and by 3.94% from the low point of 143.02 points before the cooling measures were lifted in March 2024. On February 19, 63 units and 30 units were released at the first price list of Coastal in South Kowloon City and Duck Tongue Chau, respectively. In the second round of sales, 88 units were released in the Royal City in North Point, and a residential site in Area 106B in Tung Chung was sold for 602 million Hong Kong dollars. On February 21, 50 units were released at the first price list of Belgravia Place Phase 2 in Cheung Sha Wan, and on February 22, 250 units were launched for sale in Langham Place in Yuen Long. The impact on local second-hand property prices will only be reflected in the CCL announced in mid-March 2025. The China City Leading Index for large residential estates, CCLMass, was 137.87 points, a decrease of 0.78% weekly. The CCL (small to mid-sized units) was 136.76 points, a decrease of 0.78% weekly. The CCL (large units) was 140.53 points, a decrease of 0.80% weekly, marking a total decrease of 1.39% over five weeks. CCLMass, CCL (small to mid-sized units), and CCL (large units) are at levels from the end of August 2016, mid-September, and the end of September respectively. Property prices in the four districts all fell. The CCLMass in the West New Territories was 123.80 points, a decrease of 2.49% weekly, the largest decline in 75 weeks, hitting a near 8 and a half-year low and returning to the level at the end of September 2016. The CCLMass in the East New Territories was 149.05 points, a decrease of 0.69% weekly, marking a total decrease of 2.81% over three weeks. The CCLMass in Hong Kong Island was 139.05 points, a decrease of 0.26% weekly. The CCLMass in Kowloon was 135.68 points, a decrease of 0.07% weekly, ending a two-week increase. The indices for Hong Kong Island, Kowloon, and the East New Territories have been hovering around the levels from early July 2016, the end of September, and the beginning of October respectively.

21/02/2025

In January, there were 819 bankruptcy petitions filed in Hong Kong, an increase of nearly 5% compared to the previous month.

According to the Hong Kong Official Receiver's Office, in January, they received 819 bankruptcy petitions, an increase of nearly 5% compared to the previous month and nearly 9% compared to the previous year. In January, the court issued 684 bankruptcy orders, a decrease of about 23% compared to the previous month and over 12% compared to the previous year. In terms of compulsory winding-up petitions, there were a total of 52 cases in January, a decrease of about 9% compared to the previous month and over 22% compared to the previous year. In January, the court issued 58 winding-up orders, an increase of over double compared to the previous month and 1.6 times compared to the previous year.

21/02/2025

The exchange rate of Hong Kong dollar hit a one and a half month high, general interest rates are rising, and the six-month period is back above 4%.

The Hong Kong dollar exchange rate hit a new high this morning, reaching 7.7711 against the US dollar, the strongest since January 7th. The Hong Kong dollar interbank interest rates also rebounded almost across the board, with the one-month interbank rate related to mortgages rising slightly to 4.05946%. The three-month interbank rate, reflecting the cost of bank funds, also rose to 4.06196%. Overnight rates fell for the second consecutive day, hitting a low of 3.8381%. The six-month interbank rate returned to over 4%, while the one-year rate also rose to 4.117629%.

21/02/2025

Hong Kong stocks are boiling! The Hang Seng Index surged nearly 3%, breaking through a three-year high in one go.

Driven by economic recovery and the trend of artificial intelligence (AI) in China, the Hang Seng Index has been climbing steadily, returning to key levels. In the early morning of February 21, the Hang Seng Index and the Hang Seng Technology Index opened high and continued to rise, with the Hang Seng breaking through a three-year high around 11:30 a.m. The strong uptrend in the Hong Kong stock market this time is the result of various factors working together. Firstly, the Chinese economy is steadily recovering. According to the National Bureau of Statistics, China's economy reached 134.9 trillion yuan in 2024, surpassing 130 trillion yuan for the first time, with a 5% growth compared to the previous year. China's economy remains the world's second-largest, playing an important role in global economic growth. To ensure smooth implementation of economic work this year, the government has provided policy support. At the Central Economic Work Conference, it was made clear that a more proactive fiscal policy will be implemented in 2025. This includes increasing the fiscal deficit ratio, intensifying expenditure, and accelerating expenditure progress. More government bonds will be issued to provide more support for stable growth and structural adjustment. Efforts will continue to prevent and resolve risks in key areas, promote the stable operation and sustainable development of finances. More transfers and payments to local governments will strengthen their financial resources and maintain the "three guarantees" bottom line. As 2025 approaches, global capital markets are gradually focusing on the Chinese stock market. Foreign major banks are also optimistic and bullish on the Chinese market, with solid logical support behind their decisions. Goldman Sachs maintains an overweight rating on the MSCI China Index, predicting a 14% increase in the index this year. Deutsche Bank also holds a positive view on the Chinese market, stating that global investors will recognize China's competitive advantages in manufacturing and services, with its disruptive innovation reshaping the industrial competition landscape. The continued recovery of the domestic economy and fiscal policies will support the continued rise of Hong Kong stocks. Morgan Stanley has raised its target for the Hang Seng Index in December to 24%, from 19,400 points to 24,000 points. In addition, the continuous improvement in the performance of heavyweight stocks and technology stocks will also be a key driving force for market growth, such as major technology stocks, banks, and the three major telecommunications companies. Several institutions have recently released forward-looking reports, generally expecting improved performance from Chinese internet giants such as Tencent (00700) and Meituan (03690). On February 20, Alibaba (09988) announced its financial results, with revenue from Alibaba Cloud returning to double-digit year-on-year growth of 13%, and AI-related product revenue achieving triple-digit year-on-year growth for six consecutive quarters. CITIC SEC's research report indicates that improvements in model capabilities and reduced deployment costs are expected to drive rapid growth in C-end and B-end demand, and in the medium to long term, will catalyze the acceleration of Alibaba Cloud's performance. Considering the gradual improvement in the fundamentals of the company's main business of Taobao and Tmall, as well as its leading position in the AI field and spillover benefits, it is recommended to focus on the investment prospects of AI in areas such as healthcare and entertainment. Moreover, Nomura had previously estimated that due to the strong performance of the gaming business and the growth of video ad revenue, Tencent's total revenue for the fourth quarter may increase by 8% year-on-year. Meituan's total revenue in the fourth quarter increased by 20% year-on-year to 88.13 billion yuan, with profits increasing by 197% to 9.45 billion yuan. The banking sector, which has been attracting attention, has also presented a generally stable and positive performance lately, with some banks significantly optimizing their profit indicators in the fourth quarter, and some even turning from negative to positive on a year-on-year basis. Many banks are actively seizing market opportunities and increasing investment income, with other non-interest income growing significantly.

21/02/2025

GUM: The average return of Hong Kong Mandatory Provident Fund in February was 9829 Hong Kong dollars, with the performance of Hong Kong stock funds being particularly outstanding.

Trillions of MPF advisors GUM announced that as of February 18, 2025, the GUM Hong Kong Trillions of MPF Composite Index has risen by 3.6% to 258.1; with the Trillions of MPF Stock Fund Index up 5.5%; the Trillions of MPF Mixed Asset Fund Index up 3%; and the Trillions of MPF Fixed Income Fund Index up 0.3%, with an average return of 9829 Hong Kong dollars per person. GUM stated that the stock fund with the largest increase was the Hong Kong Stock Fund (tracking index), up 13.5%, followed by the Hong Kong Stock Fund up 12.3%, the Greater China Stock Fund up 9.5%, and the US Stock Fund up only 0.2%. GUM mentioned that the Hong Kong Stock Fund and Greater China Stock Fund performed particularly well in February, benefiting from the strong performance of the stock markets in Hong Kong and Greater China, especially the growth of the technology and financial sectors. Overall, the Trillions of MPF market showed strong performance in February, particularly with the outstanding performance of stock funds and mixed asset funds bringing investors substantial returns. In the future, as the market continues to change, investors should maintain a flexible investment strategy, adjust asset allocation according to market conditions, in order to achieve the best returns.

21/02/2025

Hong Kong Stock Exchange initiates disciplinary actions against two former directors of Xin Yuan Property Services (01895)

Recently, the Hong Kong Stock Exchange took disciplinary action against two former directors of Sunyard Property Services Group Limited (01895) and issued suitability statements and condemnations to the following individuals: former Executive Director and CEO Ms. Wang Yanbo and former Executive Director and CFO Mr. Huang Bo. The Stock Exchange ruled that Ms. Wang and Mr. Huang failed to respond to the Stock Exchange's investigation-related communications, i.e. did not cooperate in the investigation, thereby violating the Listing Rules. Ms. Wang and Mr. Huang are involved in two separate investigations conducted by the Stock Exchange on the company. The suitability statement means that the Stock Exchange believes that Ms. Wang Yanbo and Mr. Huang Bo are not suitable to serve as directors or senior management members of the company or any of its subsidiaries. In 2022, after completing an investigation, the Stock Exchange made a statement harming the interests of investors and publicly condemned Ms. Wang and Mr. Huang, stating that their actions regarding certain disclosure requirements and related party transactions of the company violated their duties and responsibilities as directors under the Listing Rules. Ms. Wang and Mr. Huang cooperated with the Stock Exchange in this investigation. Before and after the implementation of the above disciplinary sanctions, the company found that several fixed deposits of its subsidiaries had been pledged and initiated an investigation into this matter. In 2023, the Stock Exchange launched another investigation into whether Ms. Wang and Mr. Huang fulfilled their duties and responsibilities as directors under the Listing Rules regarding the pledged assets. However, Ms. Wang and Mr. Huang did not cooperate in this investigation.

20/02/2025

The Hong Kong Stock Exchange (00388) welcomes the appointment of members of the board of directors by the Hong Kong SAR government.

On February 20th, HKEX (00388) welcomed the appointment of Ding Chen as a director by the Hong Kong Special Administrative Region Government, and the reappointment of Calvin Tai and Robert W. Nissen as directors. Their terms will start from the end of the 2025 HKEX Shareholders' Annual Meeting and end at the end of the 2027 HKEX Shareholders' Annual Meeting. Florence Y.Y. Lee will step down as a director at the end of the 2025 HKEX Shareholders' Annual Meeting. HKEX Chairman Calvin Tai said, "We warmly welcome the appointment of Ding Chen by the Hong Kong SAR Government, and the reappointment of Robert W. Nissen as directors of HKEX. Ding Chen's deep insights into the securities market, as well as his extensive experience in the financial services industry, particularly in the areas of asset and wealth management, will help drive the future development of HKEX. On behalf of the Board, I also thank Florence Y.Y. Lee for her significant contributions to HKEX over the past four years."

20/02/2025

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