Hong Kong faces pressure to speed up trading hours review after South Korea’s move

Hong Kong’s stock market is under pressure to expedite its review of longer trading hours following South Korea’s recent decision to expand its trading session. South Korea’s Korea Exchange introduced a real-time after-market from 4pm to 8pm, supplementing its regular hours of 9am to 3.30pm. The company also hinted at potentially extending trading hours to nearly 24 hours, echoing similar plans by Nasdaq and the London Stock Exchange.

Consequently, Hong Kong’s trading hours, currently five and a half hours from 9.30am to 4pm with a one-hour lunch break, appear inadequate by comparison.

In July, Hong Kong Exchanges and Clearing (HKEX) and the Securities and Futures Commission (SFC) separately informed The South China Morning Post that they were contemplating longer trading hours but did not provide specifics. Kenny Ng of Everbright Securities International suggested that the latest South Korean move could prompt HKEX and the SFC to accelerate their consultation process.

Tom Chan Pak-lam, honorary president of the Institute of Securities Dealers, agreed, stating that South Korea’s after-hours launch is another indicator of the global trend towards longer trading sessions and underscores the need for Hong Kong to continue evaluating and potentially improving market accessibility for global investors.

HKEX emphasized its commitment to enhancing Hong Kong’s competitiveness as an international financial hub and its ongoing review of opportunities to improve market accessibility to meet evolving investor demand. The bourse provided further updates in due course. Kenny Ng also indicated that examining whether South Korea’s extension could boost trading turnover would be beneficial for HKEX.

However, stockbrokers expressed reservations about potential longer trading hours. Robert Lee Wai-wang, a lawmaker and chairman of Grand Finance Group, stressed the importance of obtaining sufficient consensus and feedback from the market before hastily implementing changes. Despite these concerns, the stockbrokers acknowledged that the timing seemed opportune to comprehensively review the benefits and challenges of extended trading hours and consult stakeholders on the way forward.