HKEx Posts Weak Second-Quarter Result

Hong Kong Exchanges and Clearing’s weak second-quarter result reflects reduced capital market activities. Second-quarter net profit was 22% lower against the same period last year at HKD 2.17 billion, and 19% lower compared with the first quarter. This was mainly driven by lower cash market turnover, with a stronger performance for the derivatives business not enough to offset. Average daily turnover, or ADT, for the cash market was 11% lower compared with last quarter, and 15% against the same period last year. Both northbound and southbound volume were also lower against last quarter. The result was also affected by lower net investment income for the corporate funds, which saw overall net investment income at HKD 30 million in the quarter, compared with HKD 356 million the same period last year. The exchange is expected to reallocate HKD 2 billion in its corporate funds to cash deposits to minimize volatility in the second half.