CEO Blog

What does the rebound of 2025 mean for the future of Hong Kong’s markets?

My colleagues and I have been asked to explain this in media interviews, on panel discussions, at conferences and in meetings around the world.

It has been a very busy year for us at HKEX, from the surge of blockbuster IPOs to the record volumes across our markets.

But what happens next?

To understand the near future, we must look at the recent past. In considering the key drivers of market performance in the last 12 months, I identify two major forces at play.

The first is a broad trend of global capital diversification, which is being driven by the persistence of macro uncertainty. The global capital formation order is changing, and a new equilibrium has yet to be found. For some time, enabled by technology, global capital has been increasingly gravitating towards one market and a handful of stocks. Now, as global investors adopt to an increasingly multipolar world, they are starting to seek diversified growth and risk management opportunities around the world. This is, perhaps, a healthier scenario as the proper function of capital markets is to match capital to opportunities.

Hong Kong’s markets have been especially sensitive to this change in investor behaviour. Since late 2024, global investors have been finding diversification opportunities in Asia and through Hong Kong, the region’s most globally connected IFC. The twenty most active trading days in the history of our markets took place since September 2024.

While this trend is pushing capital to our markets, a second one is pulling capital in – the evolution of China’s development model. China’s “DeepSeek moment” in January 2025 was a signal of much more than the country’s prowess in frontier technologies – it was a reminder that the world’s second-largest economy is moving from a growth model driven by traditional manufacturing to one driven by high-value, innovative sectors.

This was made even more apparent by the subsequent waves of companies from a broad spectrum of sectors that emerged from the Chinese Mainland and leveraged the HKEX fundraising platform to grow their businesses internationally.

We have welcomed more than 100 new listings and raised over HK$270 billion in IPO fundraising to date in 2025. Among those were two of the world’s biggest IPOs of the year. We are now preparing to enter 2026 with more than 300 companies in the pipeline.

These trends – the push and pull of liquidity to our region; the increasing economic significance of Asia – bring us back to the question my colleagues and I have been asked the most in the last year – what happens next for Hong Kong’s markets?

Markets will always be cyclical in nature but we believe the long-term direction of travel for Asia’s markets is growth. The region’s economic growth will continue to drive the expansion of its financial markets, unleashing intra-regional opportunities, drawing global capital and setting it on a course that is likely to make it the largest capital market in the world. At HKEX, we see this as a tremendous opportunity for Hong Kong to become the heart of the world’s financial markets.

We have what it takes: unique regional connectivity; a high level of international openness; deep, liquid and diverse markets; and a commitment to continuous evolution.

It will require significant investment of resources and effort. But it is an opportunity to take our place in the centre of global finance – an opportunity we cannot afford to ignore.

How do we intend to capture this opportunity for our company and markets, and for Hong Kong?

In the last decade, our efforts were focused on developing and enhancing our capital market connectivity to the Chinese Mainland. From the Connect programme to our ecosystem of RMB products, our unrivalled connectivity to Asia’s most important growth engine attracted global liquidity, diversity and vibrancy to our markets. It has also supported the Mainland’s economic aspirations and cemented Hong Kong’s role as a global superconnector.

For HKEX, our unique market connectivity to the Chinese Mainland is our greatest advantage as a global exchange. Therefore, we will always seek to reinforce it.

In the next decade, we will also focus on strengthening the connectivity of other markets in Asia to the China growth story. By enhancing our platforms and forging partnerships in the region, we can leverage our China advantage to connect the region’s capital to its biggest opportunities: bringing exciting Asian markets, such as Southeast Asia, to investors in the Chinese Mainland, and opening the markets of the Chinese Mainland to investors from around Asia. In the process, we will help to create a regional liquidity pool with a powerful global gravitational pull.

While this strategy is underpinned by our priority to reinforce our China strength, it is also framed by three strategic imperatives.

Our second imperative is future-proofing our technology and operations. Connecting Asian investors to the China growth story – and global investors to the Asia growth story – is not enough. We must also make sure our market structure and platforms makes it as frictionless as possible to invest, trade and manage risk in our markets.

Our efforts in this in recent years have helped us to generate the levels of liquidity that have been attracting the high-quality issuers and investors we’ve welcomed in the last year. Progress has included everything from taking ownership of our own technology destiny, which has enabled us to develop the industry gold standard HKEX Orion cash trading platform; to introducing changes such as Severe Weather Trading, reduced minimum spreads and optimised IPO price discovery.

This work will continue as we anticipate greater demand for Asia assets and to optimise the conditions for cooperation with our market infrastructure partners in the region. We will soon be leading the market-wide discussion that will result in a suitable settlement cycle for Hong Kong, removing manual processes and paper-based share trading, reviewing our listing framework, delivering on the modernisation of our derivatives trading platform, adopting emerging technologies such as AI in our operations and much more.

Our third strategic imperative is to invest in adjacent capabilities, including data, analytics, the index business, digital currency, tokenisation and more. We will be looking at how to develop these adjacencies to support our core business by driving capital flows and liquidity, especially through the lens of connecting global capital to Asia opportunities.

Last week, we launched the HKEX Tech 100 Index; looking ahead we can explore creating and expanding indices that give a more global voice to Asian assets and give investors a composite exposure to the region’s most exciting opportunities. Likewise, new benchmarks and thematic indices expand product choice, which will drive further activity in our derivatives and ETF ecosystems.