SHORT-SELLING will be allowed in Hong Kong in the middle of December and the daily trading volume on the stock exchange is expected to double to about $8 billion after the auto-matching system (AMS) is introduced the month before. The exchange was also considering extending its trading hours next April, after the AMS was operating fully, said Paul Chow Man-yiu, chief executive of the exchange. The exchange would discuss extending trading hours with the Hong Kong Securities Clearing Company. The AMS will start on November 1 and be phased in to full operation over 15 weeks. It is expected three non-index constituent stocks, Tai Cheung, Sino Land and Oriental Press, will be used to test the AMS so the Hang Seng Index would not be affected. Mr Chow said the exchange was expected to experience a similar doubling in its daily turnover as had other countries where the AMS had been introduced. Hong Kong's average daily turnover was about $4 billion in the first nine months of this year, a sharp jump from $2.8 billion last year. The average daily turnovers registered in 1991 and 1990 were $1.35 billion and $1.1 billion respectively. The highest daily turnover, $8.3 billion, was recorded on May 18 this year. The exchange is also considering introducing equity options trading in the last quarter of next year. About $113 billion in capital were raised through new debt and equity issues in the first nine months of this year. Mr Chow said the exchange had in the past nine months put a lot of effort into issues from mainland enterprises. ''After Maanshan Iron and Steel [is] listed on November 2, Kunming Machine Tool Plant will be the last China state-owned en terprise to be listed in 1993,'' he said. The remaining three of the nine state-owned enterprises were expected to be listed in the local stock exchange next year.