In the past seven years, the Shenzhen-Hong Kong Stock Connect has been running smoothly, with the active participation of investors and market institutions of the two places, and the scale of transactions has grown rapidly. It has become an important bridge and window for the institutional opening up of the mainland's capital market, and has introduced a source of vitality for the healthy development of Hong Kong's capital market. At present, the total transaction value of Shenzhen-Hong Kong Stock Connect has reached 74.32 trillion yuan.
Among them, the cumulative turnover of Shenzhen Stock Connect was 59.85 trillion yuan, and the cumulative net purchase was 0.84 trillion yuan; The cumulative turnover of the Hong Kong Stock Connect was 14.47 trillion yuan, and the cumulative net purchase was 1.19 trillion yuan.
Yan Kaiwen, chief strategic analyst of Huaxin Securities, told the Securities Daily reporter that the Shenzhen-Hong Kong Stock Connect, as one of the important investment tools for investors and market institutions in the two places, has steadily expanded the scope of investment targets over the years. On the one hand, it has promoted the internationalization and diversified development of the mainland capital market while promoting the flow of funds between the markets and investor exchanges. On the other hand, it also provides broader development opportunities for enterprises and promotes high-quality development of the real economy.
International funds borrow through Shenzhen Stock Connect
Continue to pour into innovative growth enterprises
The Shenzhen-Hong Kong Stock Connect is one of the channels for Hong Kong investors to participate in the Mainland stock market. Since its launch in 2016, it has continued to play a "connecting" role, bringing together the capital, technology, information, wisdom and culture of the two markets and the global markets, thus benefiting economic development.
With the in-depth implementation of China's innovation-driven development strategy, international funds continue to gather to innovative growth enterprises through Shenzhen-Hong Kong Stock Connect, and Shenzhen's innovation characteristics are more recognized by international investors, helping to do a good job in science and technology finance, green finance and other five major articles.
Since the beginning of this year, the Shenzhen-Hong Kong Stock Connect has continued to show strong vitality and continue to contribute to the opening up of the mainland's capital market. Data show that up to now, the average daily turnover of Shenzhen Stock Exchange GEM stocks during the year reached 21.995 billion yuan, an increase of 21.56% compared with 2022; Gem stocks accounted for 38.04% of the transaction value of Shenzhen Stock Connect, an increase of 4.53 percentage points compared with 2022; The net purchase amount of Shenzhen Stock Connect GEM stocks changed from net selling in 2022 to a substantial net purchase of 24.366 billion yuan.
From the perspective of industry, since the beginning of this year, the top industries for net purchases of Shenzhen Stock Connect are power equipment and new energy, automobiles, and electronic communications industries, with net purchases of 32.336 billion yuan, 12.905 billion yuan and 9.372 billion yuan, respectively.
Market participants said that the opening of the Shenzhen-Hong Kong Stock Connect has established a new channel for the mainland and Hong Kong to share the fruits of economic development, promoted the diversification of cross-border investment needs of investors in the two places, attracted more long-term capital to the market, supported Shenzhen and Hong Kong to give play to their geographical advantages, deepened financial cooperation, and enhanced the international competitiveness of the mainland capital market and the ability to serve the real economy. We will consolidate and enhance Hong Kong's status as an international financial center and take the institutional opening up of the mainland's capital market to a new level.
Continued progress was made in improving mechanisms
The ease of cross-border investment has steadily improved
In recent years, the optimization of the Shenzhen-Hong Kong Stock Connect mechanism has continued to advance, and the institutional opening up of the capital market has made rapid and steady progress, and good news has been reported frequently.
For example, the Shenzhen-Hong Kong Stock Connect has quadrupled the daily trading limit, providing important support for the inclusion of A-shares in international indexes such as MSCI and FTSE Russell. The inclusion of ETFs in the target scope will help attract more international medium - and long-term funds to the market and promote the optimization of the investor structure of the mainland capital market; Companies listed in Hong Kong with different voting rights structure, biotechnology companies, and H-share companies corresponding to A+H shares on the Science and Technology Board will be included in the scope of the Hong Kong Stock Connect, enriching the investment choices of mainland investors; Further improve Hong Kong's investor service system and foreign shareholding disclosure arrangements to create a sound investment environment for Hong Kong investors; We will introduce the northbound and southbound see-through mechanisms to further improve cross-border and cross-market regulatory cooperation mechanisms.
Among them, this year, the Shenzhen-Hong Kong Stock Connect has implemented a substantial two-way expansion of stock targets and an optimization of the trading calendar, which has more effectively improved the convenience of cross-border transactions. Specifically, in March, the Shenzhen-Hong Kong Stock Connect implemented the largest two-way expansion since its opening, and the stock selection criteria of the Shenzhen-Hong Kong Stock Connect were more inclusive, and the stocks of eligible foreign companies listed in Hong Kong were included southwards.
Data show that as of December 5, there were 1464 Shenzhen stock Connect stocks, 564 more than before the expansion of the stock target, with a total market value of 26.91 trillion yuan, and the stock market value coverage rate of 85.05%; There were 554 stocks in the Hong Kong Stock Connect, 7 more than before the expansion of the stock target, with a total market value of HK $23.46 trillion, and the share market value coverage rate of 80.21%.
Market participants said that the two-way expansion of Shenzhen-Hong Kong stock Connect has enriched the cross-border investment options of investors in the two places, demonstrating the determination of the mainland capital market to unswervingly expand the institutional opening up.
In addition, in April, the optimization of the Shenzhen-Hong Kong Stock Connect trading calendar was officially launched and implemented, opening all Shenzhen-Hong Kong Stock Connect transactions when both markets are trading days, reducing the number of days that could not be traded by about half, increasing the number of days that investors can trade, better protecting the continuity and convenience of investors' trading, and continuously improving the attractiveness and activity of the capital markets of the two places.
Dong Zhongyun, chief economist of AVIC Securities, told the Securities Daily reporter that in the process of opening up the capital market to the outside world, the supervision continues to expand the level of opening up to the outside world and improve the convenience of foreign participation in A-shares by promoting market reform, improving the basic system, strengthening market supervision, improving market transparency and attractiveness, so as to attract international capital to actively exhibition in China. Continue to bring "source of living water" to the market.
