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Hong Kong will stay a key financial hub say experts

Hong Kong will stay a key financial hub say experts

People taking selfies by Hong Kong harbour.Image copyright
Getty Images

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People taking selfies by Hong Kong harbour.

Hong Kong’s status as a key Asian financial hub will remain intact according to business experts.

Speaking to the BBC they said new security laws and protests are unlikely to scare off investors to other countries.

Supporting this, Hong Kong’s stock exchange raised $11bn from 59 new listings in the first half of 2020.

And the blockbuster debut of Ant Group is likely to see that number grow considerably later this month.

The Chinese financial technology group could raise more than $30bn (£23bn), more than any other stock market debut this year.

Numbers like this make Hong Kong irresistible for many investors, according to Tara Joseph from the American Chamber of Commerce Hong Kong.

“The flow of money that comes in and out of Hong Kong on a daily basis, that goes into mainland China and comes out, is very hard to replicate,” she told the BBC’s Asia Business Report.

Critics have previously raised the possibility that security legislation and the ongoing trade war with China will push businesses and investors to look elsewhere.

But the sheer ability to raise money outweighs many other factors, according to Drew Bernstein, co-chairman of Marcum, Bernstein and Pinchuk, an accountancy firm.

“These companies are basically going to do whatever they have to do to have access to capital,” he said.

Asian contenders

A recent survey by the chamber found that nearly 40% of US companies were considering moving capital, assets or operations out of the city due to concerns about the new security laws.

Other Asia Pacific centres are trying to burnish their credentials as financial centres.

On Monday Japan’s Prime Minister Yoshihide Suga told financial news outlet Nikkei that his government will consider lowering tax rates and promoting diversity

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Growth Stocks Lead Hong Kong Higher, Over 400 Million Travel Domestically For Golden Week

Growth Stocks Lead Hong Kong Higher, Over 400 Million Travel Domestically For Golden Week

For a reflection on the evolution of Emerging Markets investing over the past ten years, check out my recent article.

Key News

Asian equities opened lower on failed US stimulus talks though rallied over the course of the day. Hong Kong had a strong day despite growing concerns surrounding increased social distancing measures as growth stocks led the market higher. Hong Kong volume leaders were Alibaba HK, which rose +2.93% after Goldman Sachs
raised their price target for the share class, Tencent, which rose +1.42%, Meituan Dianping, which gained +3.8%, biotech firm JHBP CY Holdings, which rose +16.46% after selling $371mm in shares in its IPO, Xiaomi, which rose +1.4%, and Ping An, which fell -0.25%. NetEase HK was off -0.22% on an analyst price target cut. Apple
suppliers AAC Technologies
gained +3.33% and Sunny Optical gained +5.1% on news of Apple’s product release. It was fairly quiet overnight as China is still on holiday and volumes have been off as a consequence.

It is being reported that over 400 million Chinese are vacationing domestically during the Golden Week holiday. Thus, it is no surprise that consumption plays are performing well this week. How do investors know what’s happening in China? Our mobile phones are a treasure chest of tasty data that is available for a price. Chinese credit/ATM payment processor UnionPay announced that transactions over their network actually increased 15% year over year. Hedge funds will pay to know which restaurants, hotels, airlines etc. those transactions are taking place in. However, we don’t need that depth of analysis to know that domestic consumption is alive and well in China. Overnight, an analyst downgraded a Chinese retailer as their app downloads were falling relative

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