New | HKEx board approves closing-auction system, price control reforms
Reforms will take effect next year as exchange chief scotches reports of delay to Shenzhen link
The Hong Kong Exchanges and Clearing board of directors on Wednesday approved two major reforms to regulate stock price movements, sources told the South China Morning Post.
The sources also said HKEx chief executive Charles Li Xiaojia scotched rumours of a delay in launching the proposed Shenzhen-Hong Kong stock connect.
"The CEO told the board that the preparation work is in full swing and the launch is on track for the second half of this year," one of the sources said.
The two reforms passed by the board on Wednesday involve a price brake to check stock volatility and the reintroduction of a closing-auction system for stocks. The Post on Monday reported the board would adopt these measures.
The sources said the reforms would be implemented next year, allowing HKEx time to change its trading system and brokers to prepare.
The volatility control mechanism passed on Wednesday would introduce a five-minute cooling-off period if a share price moves 10 per cent up or down within five minutes. The rule would apply to 81 constituent stocks of the Hang Seng Index and the H-share index, as proposed earlier, and not to all 1,700-odd stocks.