Hong Kong greets Year of the Rabbit with fanfare as stocks surge, gold advances and IPO outlook brightens

Hong Kong’s financial markets greeted the Year of the Rabbit with fanfare, as stocks surged to near an 11-month high and gold prices advanced. A delegation to the Middle East next month, led by Chief Executive John Lee Ka-chiu, will aim to enhance the city’s appeal among global investors.

Nicolas Aguzin, CEO of Hong Kong Exchanges and Clearing (HKEX), said the initial public offering (IPO) market will regain its shine this year after the bourse operator ushered in 11 listings so far this month. More than 100 other IPO candidates are also readying their plans as China’s economic reopening fuels optimism. Brokers said this number includes insurer FWD Group and logistics group Lalamove.

“We have seen some green shoots of activity and the reopening of the mainland will likely provide an argument for continuing to improve the global environment,” Aguzin said. There will be “lots of initiatives that are going to make the market more attractive”, he added.

Markets reopened on the fifth day of the Lunar New Year, an auspicious date that coincided with the birthday of the Chinese God of Fortune. HKEX hosted a live on-site ceremony to mark the first trading day of the Lunar New Year, before the Hang Seng Index surged 2.4 per cent to its highest level since March last year. Gold climbed 1.5 per cent to HK$18,150 (US$2,319) a tael, or 37.9 grams, as the local exchange hosted its event.

China officially abandoned its zero-Covid policy on January 8 by reopening its borders to visitors, while Hong Kong had earlier gradually relaxed its pandemic curbs as cases dwindled before Beijing’s policy pivot. Global funds have picked up US$17 billion worth of yuan-based stocks this year, according to Goldman Sachs, while mainland investors bought US$1.7 billion of Hong Kong-listed stocks.