Senior government officials from the Hong Kong Special Administrative Region are optimistic about the equity and gold trading markets in the Year of the Horse, expecting sustained momentum supported by ongoing reforms in market infrastructure.

“The year 2025 represents the best performance of the Hang Seng Index in terms of points and magnitude, with the benchmark index rising nearly 6,500 points, up 32 percent. IPOs (initial public offerings) and follow-on fundraising were both robust. Market liquidity improved markedly, and sources of capital were highly diversified,” Hong Kong Financial Secretary Paul Chan Mo-po said at a ceremony on the first stock market trading day of the Year of Horse on Friday.

Chan said the SAR government will uphold an open and fair market environment and promote necessary reforms, including “reviewing the ‘dual-class share structure’ framework to attract more future innovation and technology companies to list in Hong Kong.”

He also noted plans to collaborate with regulators and industry leaders to enhance market development and improve trading mechanisms, such as establishing a connected depository management system for bond and equity investments.

Hong Kong Exchanges and Clearing Chairman Carlson Tong Ka-shing said 488 companies are waiting for listing as the SAR has implemented various reforms to ensure high-quality corporate listing in the city.

“Twenty-four companies have been listed to date this year with IPO proceeds of HK$87 billion ($11.1 billion). Last year’s average daily stock market turnover reached a record-high at nearly HK$250 billion, but this January’s average daily turnover exceeded HK$278 billion, with recent trading days even surpassing HK$300 billion, reflecting the effectiveness of various liquidity enhancement measures,” Tong said.

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As international investors’ asset allocation needs are not limited to stocks, but also extend to bonds, currencies, and commodities, HKEX hopes to build a complete ecosystem covering products, trading, settlement, data, and information services that can expand the market size and bring more growth opportunities to Hong Kong’s financial market, HKEX CEO Bonnie Chan Yi-ting said.

On a related note, the Hang Seng Index experienced a decline on Friday, closing down 1.1 percent at 26,413.35 points. The Hang Seng China Enterprises Index fell by 1.22 percent to end at 8,959.56 points, while the Hang Seng Tech Index decreased by 2.91 percent to 5,211.5 points. This dip aside, the focus remains on long-term growth in Hong Kong’s financial landscape.

Gold hub vision

Apart from the bond and equity market, the SAR government is also devoting resources to develop the city as a full-fledged international gold trading center.

The vision is to establish Hong Kong as a regional gold reserve hub by expanding its gold storage capacity to over 2,000 metric tons within three years, thereby developing a comprehensive industry chain in the gold trading industry in the segments of investment and trading, derivatives, warehousing, insurance, trade and logistics.

“The Financial Services and the Treasury Bureau has established a wholly owned company as the governing body for the gold central clearing system, with the goal of commencing trial operations this year.

“There are currently 15 London Metal Exchange-approved warehouses operating in Hong Kong, and we will support the industry to establish more approved warehouses,” Hong Kong Undersecretary for Financial Services and the Treasury Joseph Chan Ho-lim said.

The administration is actively promoting the establishment or expansion of gold refineries by gold merchants in Hong Kong. “We have signed a memorandum of understanding with the Shenzhen Municipal Financial Regulatory Bureau to support Hong Kong gold merchants in using gold refining facilities established in Shenzhen through trade-processing cooperation and exporting refined gold to Hong Kong for trading and delivery purposes,” he added.

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Hong Kong Gold Exchange Chairman Haywood Cheung Takhay said: “The Shanghai Gold Exchange’s participation in the newly established gold central clearing system in Hong Kong will help improve the reliability of delivery, and the interconnection of the gold markets between the Chinese mainland and Hong Kong is just around the corner.

“We estimate more than 10 Hong Kong and mainland institutions will become members of the Hong Kong Gold Exchange this year. More refineries and gold traders from the mainland will come to Hong Kong to develop their businesses and expand overseas through Hong Kong’s platform,” Cheung added.