The Hong Kong stock market is on the verge of a new wave since the early days of the Covid-19 epidemic, after Chinese technical institutions set up lucrative laws that play a key role in the city’s exchange.
Bankers expect Hong Kong to reconsider after Beijing began to oppose US lists in a fight with Didi Chuxing shortly after launching a US company in June.
But investors and researchers say continued uncertainty about Hong Kong as Beijing’s destination, as well as many other factors, has hampered plans.
“This year I will wash it off like a shower,” admitted the head of Asia-Pacific’s largest markets at another Wall Street bank, adding that many banks and brokers do not expect to return until the first quarter of 2022, and manufacturers are hungry to hear from. in Beijing on its new government on the maritime list.
Chinese religious groups have earned only $ 671m on Hong Kong’s list over the past three months. The whole new lineup also raised $ 6.5bn – down about 60% a year, according to Dealogic research. This was the worst case scenario in all of these cases since the first quarter of 2020, when the Covid-19 epidemic hit global markets.
The aforementioned regions of Hong Kong also experienced difficulties. The Hang Seng Index has fallen by almost 10% this year, indicating a sharp rise against China’s most developed groups, while the Hang Seng Tech index has declined by more than a quarter despite a regional conference.
The analysts say the sale and suspension of IPO suspensions confirmed Hong Kong’s threat to China’s security operations, which has been a key source of IPOs for the city after its 2018 parliamentary roll.
“In a short time. . . I don’t think we should see the pressure of the IPO to resume in Hong Kong, “said Thomas Gatley, a Beijing researcher at Gavekal Dragonomics, pointing out what the Chinese authorities say is” difficult to expand capital “.
Gatley said the transition to IPOs from New York to Hong Kong would not be as fast as banks expected – although it was possible “in the next few years”. But in the case of Hong Kong’s closest altercation, the high risk of repercussions and beatings by Chinese technology means that “in any case, its value is based on low cost”.
The amount of profits Hong Kong will take will depend on changes in Chinese foreign policy, which security officials in the country will have to give to senior officials in Beijing for approval on an undisclosed date.
In July, state media also described the “reform of foreign policy” as one of the key issues discussed at a July meeting of Chinese President Xi Jinping and other officials on policy initiatives in the second half of 2021.
Bruce Pang, chief research officer at China Renaissance, a financial bank, said this meant that the China Securities and Regulatory Commission should issue its plan before this year.
But he said the stock market in Hong Kong should stop publishing changes that have been long-awaited under its IPO rules until the CSRC system is announced. This could jeopardize his chances of making a quick buck on a list of Chinese pre-packaged items in New York, many of which could now be chosen to list in Shanghai or Shenzhen instead.
Hong Kong Exchanges and Clearing said it “welcomes IPO services from any company that meets our requirements”, adding that HKEX had more than 200 operating systems.
“[HKEX] “They certainly cannot come out and say ‘just write anything’,” says Fraser Howie, an independent researcher and economist in China.
Mr Howie said the Hong Kong sales list for most companies would have included profits, and all those who would register would be consulted by the listing committee. This is even more difficult than in the US, where a simple disclosure has allowed Chinese companies to raise about $ 35bn in the years since HKEX changed its IPO rules.
“It is not clear whether Hong Kong has a better or more prosperous future as people think,” Howie said.