Liu Minxia

    mllmx@msn.com

    GLOBAL investors will be able to trade shares of some of China’s fastest growing firms starting Monday next week and the Shenzhen-Hong Kong stock connect program will bring opportunities to Shenzhen-listed shares, especially those that do not have peers in Hong Kong, PwC’s Shenzhen office said yesterday.

    The Shenzhen Stock Exchange, one of China’s two stock exchanges, is home to many “new economy” firms in such sectors as health care and technology, which analysts say could prove more attractive to foreign investors than the large State-owned firms in slow growth sectors that dominate the Shanghai exchange.

    “The Shenzhen exchange is different from the Shanghai exchange in many ways,” said Eddie Wong, a PwC capital market services partner. “Trading on the SME board [of the Shenzhen exchange] is very active, which includes many prominent high-tech firms in fields including information technology and emerging industries. They are complementary to [firms listed on] the Hong Kong exchange and will be among those that are expected to benefit from the program most substantially.”

    The upcoming Shenzhen-Hong Kong trading link program, which is similar to the existing Shanghai-Hong Kong stock link that was launched two years ago, will allow investors in Hong Kong to buy roughly 880 Shenzhen-listed stocks and in return, mainland investors will have access to 417 stocks listed in Hong Kong.

    Combined with the Shanghai-Hong Kong link, the Shenzhen trading pipe will allow access to more than 1,400 yuan-denominated stocks, or about 80 percent of the total publicly traded A share market capitalization.

    According to PwC data, the connect program will create the second-largest equity market globally, at roughly US$10 trillion, only second to the New York Stock Exchange.