Early days
Article Abstract:
Chinese and Hong Kong stock prices have recoered with other Asian stock prices in early 1998, but they did not drop as far as prices in many Asian markets, so may not rise as much. Further problems could still arise for Hong Kong, where real interest rates are high, which sill affect real estate and banking stocks which account to two thirds of the market in Hong Kong. Hong Kong interest rates may be lowered in 2nd half 1998, which would help stock prices, though if the Hong Kong dollar or Chinese renminbi were to be devalued, this would hit stocks.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1998
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Changing shape
Article Abstract:
The Hong Kong stock market has been affected by closer links with China, according to Morgan Stanley. More companies based in China, or backed by China have entered the market, and Chinese funds are also investing in Hong Kong. Brokers' turnover is increasing and this retail flow could push up the Hang Seng index to record levels. China could seek to stem the flow if it is seen to affect Chinese interests, but they may be permitted due to the critical transition stage of Hong Kong.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1997
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A safe peg
Article Abstract:
The Hong Kong dollar is likely to stay pegged to the US dollar despite being overvalued, NatWest Securities argues. This is because the peg is controlled by three banks with most of the market onshore, and domestic investors are not likely to move to US dollars unless they forecast devaluation. Mainland China is not likely to permit a devaluation. Hong Kong stocks could still be affected by oversupply of real estate since a drop in real estate prices would hit stock prices.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1997
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