– HKEX CEO Bonnie Chan (陈翊庭) revealed during the 2025 interim results meeting that the exchange is studying extended trading hours, following Nasdaq’s plan to implement 24/5 trading in late 2026.
– The Hong Kong Securities ETF has already surged over 64% year-to-date, significantly outperforming A-share brokerage stocks, indicating strong market anticipation.
– Analysts from Huatai Securities and CICC suggest brokerage stocks, particularly A-shares, remain undervalued and may experience a revaluation driven by sustained market optimism and institutional repositioning.
– Recent HKEX reforms, including reduced minimum tick sizes and ongoing T+1 settlement preparations, signal a broader push to enhance market efficiency and attract global participants.
– If implemented, 24/5 trading could dramatically boost liquidity, volumes, and revenue for both HKEX and brokerages, though adoption will require careful risk and system upgrades.
Evening in Hong Kong brought unexpected news that sent ripples through the financial sector. At the HKEX 2025 interim results meeting, Group CEO Bonnie Chan (陈翊庭) addressed one of the market’s most hotly debated topics: extended trading hours. Her comments came against the backdrop of Nasdaq’s groundbreaking announcement to implement 24-hour, five-day-a-week trading by late 2026—a move that could fundamentally reshape global market dynamics. For Hong Kong’s so-called ‘bull market flag bearers’—brokerage stocks—this development represents more than just operational evolution; it signals a potential transformation in how Asian markets compete for global capital flows and trading activity.
HKEX’s Strategic Positioning for Global Competitiveness
During the August 20th meeting, Chan emphasized HKEX’s commitment to maintaining global competitiveness through strategic investments. ‘HKEX adheres to the principle of strategic investment in maintaining global competitiveness,’ she stated. ‘We are not stingy on capital expenditure and continue to increase investment in data platform optimization, trading and settlement system upgrades, and other areas.’ This statement underscores the exchange’s recognition that technological infrastructure forms the backbone of any modern financial marketplace. The comments arrive at a pivotal moment as exchanges worldwide grapple with how to balance innovation against stability, especially when considering radical changes like extended trading hours.
The 24/5 Trading Study: Methodical and Measured
Chan’s approach to the extended hours question was characteristically prudent. ‘Regarding the issue of extending trading hours, we note that Nasdaq plans to implement a 24-hour, five-day trading mechanism in the second half of 2026,’ she told attendees. ‘HKEX will adhere to the principle of caution and gradual progress, conducting research based on fully learning from international peer experience while combining it with local market实际情况.’ This careful language indicates that while HKEX is actively studying the possibility, any implementation would follow a deliberate, risk-aware path. She further clarified that such a progression would require ‘transaction system upgrades, risk management system improvements, and mature supporting regulatory frameworks’—suggesting a multi-year timeline even if approved.
Beyond Trading Hours: HKEX’s Broader Reform Agenda
The trading hours discussion isn’t happening in isolation. HKEX has been actively implementing a series of market structure enhancements aimed at boosting liquidity and reducing costs. On July 28th, the exchange announced that the first phase of reducing the minimum tick size—the smallest allowable price movement for a stock—would take effect on August 4th. This change, primarily affecting stocks priced between HK$10-20 and HK$20-50, lowers the minimum increment from HK$0.02 to HK$0.01 and from HK$0.05 to HK$0.02 respectively. For traders and investors, this means reduced transaction costs and potentially improved execution efficiency, particularly for retail participants.
T+1 Settlement: The Other Key Initiative
Another critical area of focus is settlement cycle compression. Chan confirmed that HKEX is ‘actively discussing shortening the spot market settlement cycle with market participants.’ Notably, she revealed that ‘HKEX’s technical systems will be able to support a T+1 settlement cycle by the end of this year.’ However, she tempered expectations by noting that actual market implementation ‘requires soliciting opinions from multiple market participants,’ indicating that operational readiness alone doesn’t guarantee immediate adoption. The move toward T+1 aligns with global trends, including the U.S. shift to T+1 in 2024, and would represent a significant step in reducing counterparty risk and freeing up capital for market participants.
The Brokerage Sector: Prime Beneficiary of Market Evolution
If HKEX does eventually implement 24/5 trading, analysts universally agree that brokerages would be among the biggest winners. Extended hours mean more trading opportunities, higher volumes, and consequently, increased commission revenue and potential margin financing activity. The optimism is already reflected in market performance: the Hong Kong Securities ETF has skyrocketed over 64% year-to-date, building on last year’s 44% gain. This starkly outperforms A-share brokerage stocks, suggesting that international investors see Hong Kong’s financial sector as particularly well-positioned for coming changes.
Institutional Perspectives on Brokerage Valuation
Huatai Securities published analysis suggesting that brokerage stocks still present a compelling revaluation opportunity. They note that since the beginning of the year, ‘equity markets have steadily moved upward, with trading volume, margin lending balances, and equity product issuance scale continuously improving.’ However, they highlight that this cycle differs from previous ones: ‘On one hand, the sustainability of the market行情 has strengthened, making brokerage performance growth more sustainable. On the other hand, the internal repair rhythm of the sector is differentiated, with H-shares preceding A-shares, and brokers with steady performance growth performing better.’ Their overall conclusion remains bullish, citing ‘steady upward movement in equity asset returns, positive central government positioning for capital markets, quasi-‘stabilization fund’ support for the market, and residents’ funds entering the market in an orderly manner.’
CICC analysts added quantitative depth to the optimistic outlook. They pointed out that ‘as of the end of Q2, actively managed equity funds were still underweight A-share brokerage sector by 2.67% and Hong Kong stocks by 0.52%.’ This suggests significant room for institutional repositioning should sentiment continue improving. On valuations, they note that ‘in terms of price-to-book ratio, the A-share/H-share brokerage sector is currently trading at 1.66x/1.17x P/B, at the 45%/70% percentile since 2014 respectively.’ Within their PB-ROE framework, they conclude that ‘sector valuations do not appear significantly overvalued,’ and compared to other key market sectors, ‘brokerage sector valuation percentiles are also relatively low.’ Combining this with dividend yields—projecting 2.3% for A-shares and 3.0% for H-shares in 2025—they see ‘good relative配置 value’ based on asset stability and earnings growth certainty.
Comparative Analysis: Hong Kong vs. Global Exchange Trends
Nasdaq’s decision to pursue 24/5 trading has undoubtedly accelerated similar considerations worldwide. For HKEX, the pressure is twofold: compete with global pioneers like Nasdaq while also maintaining its role as the primary gateway between Chinese capital and global markets. The extended hours debate touches on fundamental questions about market ecology. Would round-the-clock trading primarily benefit high-frequency and algorithmic firms at the expense of traditional brokers? How would it impact exchange employees, settlement teams, and listed company investor relations departments? These practical considerations explain Chan’s cautious phrasing about ‘learning from international peers’ and ensuring ‘risk management system improvements.’
Technical and Operational Hurdles
Implementing 24/5 trading isn’t simply a matter of keeping lights on. It requires robust disaster recovery systems, shift-based staffing models, liquidity provision mechanisms during off-peak hours, and coordinated regulatory oversight across time zones. For Hong Kong, there’s the additional complexity of its relationship with Mainland markets—would extended hours create arbitrage opportunities or settlement complications with Shanghai and Shenzhen connect programs? These are the types of questions HKEX must answer before any green light.
Investment Implications and Strategic Considerations
For investors, the evolving situation creates both short-term trading opportunities and long-term strategic questions. The immediate beneficiary appears to be Hong Kong-listed brokerages, which could see volume growth from both extended hours and ongoing market activation measures. However, the revaluation potential in A-share brokerages shouldn’t be ignored, especially if domestic institutional investors begin closing their underweight positions. Beyond brokerages, potential winners include fintech firms providing trading infrastructure, data vendors serving after-hours markets, and securities with high international ownership that might see increased foreign participation.
Risks and Counterarguments
While the outlook appears bright, investors should remain aware of risks. Extended trading hours could dilute volatility and volume per hour rather than creating new activity. There’s also execution risk—HKEX might delay or modify proposals based on industry feedback. Additionally, broader market corrections could overshadow sector-specific positives, especially given brokerage stocks’ traditional role as high-beta plays on financial markets.
The Path Forward: Catalytic Expectations and Market Evolution
Bonnie Chan’s comments have undoubtedly ignited catalytic expectations across the financial sector. While actual implementation remains years away, the very fact that HKEX is formally studying 24/5 trading signals ambition to not just follow but potentially lead in global exchange innovation. For ‘bull market flag bearers’—the brokerage sector—this provides a powerful narrative alongside solid fundamentals: improving volumes, supportive policies, and attractive valuations. The coming months will be critical as HKEX engages with stakeholders on both T+1 settlement and the extended hours study.
Market participants should monitor several key milestones: HKEX’s technical readiness for T+1 by year-end, further details on the extended trading hours study, and most importantly, continued volume and revenue growth across brokerage operations. In many ways, the current situation encapsulates modern markets—where technological possibility, regulatory deliberation, and investor anticipation interact to create both opportunity and uncertainty. One thing seems clear: the evolution of Hong Kong’s market structure is accelerating, and its effects will ripple far beyond exchange trading floors.
For investors and industry professionals, the message is to stay informed and engaged. Review brokerage sector exposure considering both Hong Kong and A-share opportunities, monitor HKEX consultation papers for upcoming changes, and assess how operational capabilities might need to adapt to a potentially 24/5 trading environment. The catalytic expectations are now set; the coming years will reveal how they translate into reality.