Wednesday July 8 2015

News Source: Global Exchanges

Focus: Credit Rating

Type: General




Hong Kong Exchanges and Clearing Limited (HKEx) has published its consultation conclusions on the proposed introduction of a Volatility Control Mechanism (VCM) to safeguard its securities and derivatives markets and a Closing Auction Session (CAS) in its securities market to facilitate trade execution at securities` closing prices.

Having carefully considered the responses and the rationales behind them, HKEx concluded that there is substantial market support for the introduction of a VCM and a CAS in the Hong Kong market, and it will proceed with the implementation of the two initiatives.

The CAS will be rolled out in two phases. CAS Phase 1 is tentatively set to include all the Hang Seng Composite LargeCap and MidCap index constituent stocks, the H shares which have corresponding A shares listed on the exchanges in Mainland China and all ETFs. The list of securities included in the CAS will be confirmed and published before launch of Phase 1. Phase 2 will be rolled out after a review, tentatively scheduled for six months after Phase 1, and will include all equity securities and funds.

The VCM will cover Hang Seng Index (HSI) and Hang Seng China Enterprise Index constituent stocks in the securities market, and the spot month and the next calendar month HSI, Mini-HSI, H-shares Index (HHI) and Mini HHI futures contracts in the derivatives market.

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