Super Typhoon Saola: Hong Kong halts stock trading on city’s T8 storm warning

The Hong Kong Observatory upgraded its storm warning signal to T8 on Friday morning, after issuing the No 3 signal on Thursday
Weather-related market interruption is the second this year after Typhoon Talim lashed the city on July 17

Hong Kong stock market

Zhang Shidongin Shanghai

Published: 7:08am, 1 Sep 2023

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Hong Kong’s stock market will close on Friday after the government hoisted the No 8 storm warning signal as Super Typhoon Saola approaches the city, bringing heavy rain and gales to the financial hub.

Trading in stocks and futures will be suspended under the stock exchange’s rules on extreme-weather events, according to the bourse operator Hong Kong Exchanges and Clearing Limited (HKEX). The Hong Kong Observatory upgraded the storm signal on Friday morning, after issuing the No. 3 warning a day earlier. Markets in mainland China will open for business as usual.

“Saola will be closest to Hong Kong tonight and tomorrow morning, skirting within around 50 km south of the Observatory,” it said in an update at 11.45am local time, adding that the T8 signal will remain in force for most of Friday. “The Observatory will assess the need to issue higher tropical cyclone warning signals around this evening.”

This is the second time HKEX has halted trading this year under its guidelines on inclement weather. The local market was forced to close on July 17 when Typhoon Talim lashed the city.

05:16

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As the T8 signal remains in force past noon, “all trading sessions in the securities and derivatives markets have been cancelled,” HKEX said in a statement.

The Hang Seng Index tumbled 8.5 per cent in August, its worst monthly performance since a 9.4 per cent sell-off in February. Heightened concerns about China’s economic slump, and disappointment over Beijing’s slow-drip approach to stimulus have induced fund outflows.

Hong Kong shoppers rush to stock up as Super Typhoon Saola edges closer to city

In the past three years, tropical storms Higos, Nangka and Nalgae have also hit the city’s financial markets, prompting top executives at HKEX to look for ways to stem losses caused by market interruptions.

HKEX handled HK$115.5 billion (US$14.5 billion) of turnover per day in securities trading in the first six months this year, a 16 per cent drop from the same period last year, according to its August 28 report. The market for exchange-traded funds averaged HK$11.7 billion per day in the same period, it added.

Separately, Hong Kong’s schools and kindergartens will also be shut on Friday, which marks the first day of a new semester. The neighbouring city of Shenzhen in southern Guangdong province will also close schools, pushing back the start of a new semester to September 4.