HKEx expected to see earnings fall up to 20pc
Lower market turnover and fewer listings blamed for poor results at the exchange
Hong Kong Exchanges and Clearing, which operates the local stock and futures markets, is expected to report a decline of up to 20 per cent in net profit last year as a result of lower market turnover and fewer initial public offerings (IPOs).
Analysts estimated profit could drop 12 to 20 per cent to between HK$4 billion and HK$4.5 billion in the year to December.
Announcement of the results is due on Wednesday.
Kenny Lee Yiu-sun, the chief executive of First China Securities, said the lower the market turnover, the smaller the trading and clearing fees investors paid for each transaction, and hence the poor income at HKEx.
"Trading and clearing fees are the major sources of income for the exchange," he said. "As the stock market turnover dropped last year, so did the profit of the exchange."
The average daily turnover of the stock market shrank 22.77 per cent last year to HK$53.85 billion from a year earlier, which brokers blamed on the economic uncertainties in Europe and the United States.