HKEX’s new Hang Seng Biotech Index Futures to debut next month Hong Kong Exchanges and Clearing (HKEX) plans to launch the Hang Seng Biotech Index Futures next month, as offshore investors show heightened interest in mainland Chinese biopharmaceutical stocks listed in the city. The new futures contracts platform, which is expected to commence trading on November 28, aims to offer investors a risk management tool for “one of the fastest-growing and most dynamic sectors,” the exchange operator said on Tuesday. Built on the Hang Seng Biotech Index, the platform will track the performance of the 30 largest Hong Kong-listed Chinese pharmaceutical and medical device companies, whose shares can be bought and sold by mainland investors through the southbound Stock Connect scheme. “The introduction of this new futures product reinforces HKEX’s commitment to strengthening Hong Kong’s position as Asia’s leading derivatives trading and risk management centre,” said Gregory Yu, head of markets at HKEX. He expected the platform to add “breadth and diversity to meet the evolving needs of global investors”. “Driven by innovation and strong global healthcare demand, the biotech industry is one of the most exciting frontiers in capital markets today,” Yu said. Beyond expanding investors’ access to the sector’s potential, the Hang Seng Biotech Index Futures reflect the city’s efforts to contribute to the development of the region’s biotech ecosystem. Trading under the code HBI, the Hang Seng Biotech Index Futures will use a contract multiplier of HK$50 (US$6.40) per index point. The Securities and Futures Commission’s transaction levy will be waived for the first six months of trading of the new contracts. Margin rates would be announced in due course, according to the HKEX. “Futures contracts enable institutional investors to hedge and manage risk effectively,” said Mike Leung Kit-man, director at Wocom Securities. “A diverse range of derivative products, in turn, helps attract more investors to participate in equity trading, enhancing overall market liquidity.” Leung said the Hang Seng Biotech Index Futures would be “highly attractive to institutional investors and can further draw more overseas capital into the Hong Kong stock market, as well as encourage more biotech companies to choose Hong Kong for their listing in future”. China’s pharmaceutical sector has outpaced the broader market this year. The H-share innovative drug index surged 107 per cent as of September 30, exceeding the 30 per cent rise of the Hang Seng Index in the same period. On the mainland, the A-share Pharmaceutical Index climbed 23 per cent, compared with a 16 per cent gain in the CSI 300, according to an HSBC report. Hong Kong’s bourse hosts more than 260 biotech and healthcare companies – with a combined market capitalisation that exceeded HK$4.8 trillion, up 400 per cent from about HK$1.2 trillion at the end of 2018. https://www.scmp.com/business/banking-finance/article/3328946/hkexs-new-hang-seng-biotech-index-futures-debut-next-month (ICE HONG KONG)

Fonte notizia: South China Morning Post