Hong Kong’s stock exchange has reported another record-breaking quarter, signalling a strong revival in listings and trading activity fuelled by renewed investor confidence in Chinese assets.
The performance highlights Hong Kong’s return as a key global fundraising hub after years of subdued activity, with rising inflows from mainland firms and a jump in derivatives trading driving profits to new highs.
The surge also reflects a broader shift in global investment flows, as investors seek stability and growth opportunities in Asian markets amid persistent geopolitical tensions and changing monetary policies across major economies.
Net income jumps amid surge in listings and trading
Hong Kong Exchanges & Clearing Ltd. (HKEX) posted a net income of HK$4.9 billion ($630 million) in the third quarter, exceeding analysts’ estimates of HK$4.71 billion, according to Bloomberg.
The result marks a significant rebound, supported by a 54% rise in core business revenue to HK$7.5 billion, mainly from trading and clearing fees.
The rally in trading volumes and renewed global appetite for Chinese assets have positioned HKEX for its strongest year since 2020.
The exchange noted that overall stock trading more than doubled during the quarter, while trading by mainland Chinese investors through the Shanghai and Shenzhen Stock Connect links more than tripled.
IPO fundraising hits four-year high
Hong Kong is on course to record a four-year high in initial public offering (IPO) fundraising in 2025. Over the first nine months of the year, 69 companies raised HK$188.3 billion through IPOs, compared to HK$55.6 billion in the same period last year.
This sharp increase reflects renewed interest from mainland Chinese companies seeking to list in the territory, as well as improving sentiment among international investors looking for exposure to China’s capital markets.
Secondary stock offerings have also seen significant activity, reaching HK$264.1 billion in the first nine months.
HKEX reported an active IPO pipeline of 297 companies as of the end of September, underscoring continued momentum in equity capital markets despite broader concerns over global economic uncertainty.
Global diversification boosts Hong Kong’s competitiveness
The surge in trading and listings has been partly driven by investors seeking diversification amid shifting global capital flows.
Hong Kong’s appeal as a financial gateway to China has strengthened as global investors balance exposure between Western and Asian markets.
The city’s benchmark index has surged 29% this year, supported by the strong performance of Chinese firms and a rebound in investor sentiment toward the region.
HKEX Chief Executive Officer Bonnie Chan noted in a statement, as per Bloomberg, that the exchange continues to capture the “momentum of global diversification and attractiveness of Chinese assets.”
This strategic advantage has been key in helping Hong Kong consolidate its position as one of the world’s leading financial centres, even as regional competition intensifies.
Positive momentum sets the tone for 2025
The third-quarter results reflect not only a cyclical rebound but also structural resilience in Hong Kong’s financial ecosystem.
With the largest number of IPO applications in years and record-high trading volumes, HKEX appears poised for sustained growth heading into 2025.
The combination of recovering global demand for Chinese equities, robust cross-border trading, and rising derivatives activity suggests that Hong Kong’s capital markets are regaining the vitality they lost in recent years.
The exchange’s focus on technological innovation and connectivity with mainland China is also expected to further enhance its appeal among institutional and retail investors alike.
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