Hong Kong’s Fintech Push Gains Momentum as China’s Factory Output Slows

Hong Kong announced plans to ease regulations governing virtual asset trading in an effort to boost market liquidity and strengthen its position as a leading global fintech and digital asset center, officials said on Monday. According to Julia Leung, CEO of the Securities and Futures Commission (SFC), the regulatory body will permit locally licensed virtual asset trading platforms to share global order books with overseas affiliates. The measure, unveiled at the Hong Kong Fintech Week conference, underscores the city’s ambition to compete with major financial hubs such as Singapore and the United States amid growing investor interest in digital assets.

At the same event, Hong Kong Monetary Authority Chief Executive Eddie Yue stated that the banking industry stands to benefit significantly from ongoing digital transformation efforts. He noted that technological investment in the sector is expected to exceed HK$100 billion (US$12.87 billion) annually over the next three years, highlighting the city’s commitment to advancing financial innovation.

In local markets, Hong Kong’s Hang Seng Index rose 1.1% to close at 26,183.60. Gains in technology stocks were tempered by sharp losses in the jewelry sector, with Chow Tai Fook Jewellery Group falling 8.7% after the Chinese government reduced tax rebates on gold sales. The policy change dampened enthusiasm for gold-related equities, though strong demand for the precious metal has recently driven its price to record highs. On Monday, gold prices edged up 0.8% to $4,028 per ounce, still below their recent peak of nearly $4,400. Analysts noted that beyond Chinese consumer demand, global investors and central banks have also been increasing their gold holdings as a safeguard against economic uncertainty.

Economic data from China indicated a slowdown in factory activity. The private RatingDog China General Manufacturing PMI declined to 50.6 in October from 51.2 in September, signaling a softer pace of expansion. Similarly, the official manufacturing PMI released by the National Bureau of Statistics on Friday slipped to 49 from 49.8, pointing to contraction in the industrial sector. The Shanghai Composite Index nonetheless gained 0.5% to 3,973.10, while Taiwan’s Taiex advanced 0.4%.

There was little immediate market response to U.S. President Donald Trump’s statement that Chinese President Xi Jinping had pledged not to take action against Taiwan during Trump’s tenure. The Taiwan issue was not discussed in their recent talks in South Korea, which primarily focused on trade relations. However, in a televised interview on CBS’s *60 Minutes*, Trump expressed confidence that Beijing would refrain from any moves against the self-governed island while he remains in office.