Capital inflows by mainland Chinese investors in HK bourse to hit 200 billion yuan next year
Yuan devaluation, stock trading link, and the irresistable trend of Chinese companies going global to spur southbound money flows
Capital inflows by mainland Chinese investors into the Hong Kong stock market is expected to hit 200 billion yuan (HK$229.1 billion) next year and account for almost 20 per cent of the estimated annual equity turnover in the city, analysts from UBS Securities said on Monday.
“The biggest opportunity for the Hong Kong bourse next year will be the southbound money flows from mainland China,” said Lu Wenjie, the market strategist for UBS Securities.
The total size of the southbound flows might have reached 150 billion yuan to 160 billion yuan this year, according to UBS’ estimates. That is slated to reach 200 billion yuan next year, Lu said.
“It would be close to the IPO market size in Hong Kong,” he added.
In 2015, Hong Kong overtook New York as the world’s biggest IPO market, with the amount of funds raised through IPOs reaching HK$261.3 billion.
Money from mainland buyers accounted for 12 to 13 per cent of Hong Kong’s total equity turnover so far this year, up significantly from the average 9 per cent in 2015 and 5 per cent in 2014, Lu said.