The Hong Kong stock exchange will close on Friday after the government issued a No. 8 storm warning as Super Typhoon Saola approaches the city, bringing torrential rain and gales. According to the market operator Hong Kong Exchanges and Clearing Limited (HKEX), trading in stocks and futures would be stopped due to the stock exchange's rules …
The Hong Kong stock exchange will close on Friday after the government issued a No. 8 storm warning as Super Typhoon Saola approaches the city, bringing torrential rain and gales.
According to the market operator Hong Kong Exchanges and Clearing Limited (HKEX), trading in stocks and futures would be stopped due to the stock exchange’s rules on extreme weather occurrences. After issuing the No. 3 warning the day before, the Hong Kong Observatory raised the storm signal on Friday morning. Markets in mainland China will reopen as normal.
This is the second time this year that HKEX has suspended trade due to bad weather. When Typhoon Talim hit the city on July 17, the local market was forced to close. If a No. 8 signal or higher is issued before the 9am-9.30am per-opening session, markets will be closed for the day and will stay closed until noon local time, HKEX said in a statement on Friday.
The Hang Seng Index fell 8.5% in August, its worst monthly performance since a 9.4% drop in February. Concerns over China’s economic slowdown, as well as displeasure with Beijing’s slow-drip approach to stimulus, have resulted in money outflows.
Tropical storms Higos, Nangka, and Nalgae have also struck the city’s financial markets in the last three years, forcing top officials at HKEX to explore for solutions to mitigate losses caused by market disruptions.
According to its August 28 report, HKEX processed HK$115.5 billion (US$14.5 billion) in securities trading volume each day in the first six months of this year, a 16% decrease from the same period last year. During the same time period, the exchange-traded fund market averaged HK$11.7 billion every day.
Separately, Hong Kong’s schools and kindergartens will be closed on Friday, the first day of the new semester. Shenzhen, a bordering city in southern Guangdong province, will similarly close schools, postponing the start of the new semester back to September 4.
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