China News Service, Hong Kong, November 11 (HKEX) The Hong Kong Exchanges and Clearing Group (HKEX) published a consultation paper on November 30, making recommendations on maintaining normal operations in Hong Kong's securities and derivatives markets under inclement weather, and seeking market opinions on the mode of operation and related arrangements. The consultation period will last for two months and will end on 30 January 2024.
HKEX Chief Executive Officer Nicolas Aguzin said that Hong Kong is one of the world's leading international financial centres and a preferred centre for risk management and asset allocation. As a result, it is imperative that the Hong Kong market maintain normal trading in adverse weather conditions to ensure that investors can continue to manage their portfolios and the associated risks. With reliable technology in place to ensure safe and smooth remote work, it is time to synchronize the operations of the Hong Kong market with other major markets around the world.
According to the Hong Kong Stock Exchange, since 2018, bad weather has led to 11 market closures in Hong Kong, four of which occurred in 4, and the market shutdowns lasted from a few hours to an entire trading day. As such, HKEX proposes to open its securities and derivatives markets to all investors as usual during adverse weather conditions.
HKEX said that during inclement weather, trading, post-trading and listing arrangements will be essentially the same as on normal trading days, but some necessary adjustments will need to be made to ensure the operational resilience of the market and the safety of market participants. Some services provided by physical locations will not be available.
HKEX emphasises in the document that the safety of people and investors is a core consideration, and that the provision of services through physical locations is discouraged during inclement weather. Investors are now generally trading electronically, and even in bad weather, physical locations such as banks do not offer in-store trading, which should not have a significant impact on market activity. In the meantime, the trading, clearing and settlement and market data systems will all be remotely accessed online, and HKEX has repeatedly optimised its infrastructure and operation to reduce the need for market participants to visit the system in the office, and will consider arranging technical tests to help market participants prepare for normal trading in adverse weather.
HKEX said that in order to give the market sufficient time to prepare, the task force, which includes the Hong Kong SAR Government, the Hong Kong Securities and Futures Commission and the Hong Kong Monetary Authority, has proposed to provide a six-month lead time before maintaining trading in inclement weather, which will take effect in July 6. (ENDS)