Basic knowledge of Hong Kong Stock Connect stocks
Hong Kong Stock Connect, refers to the investor entrusted to the members of the Stock Exchange, through the Stock Exchange Securities Trading Service Company, to declare to the Stock Exchange, buy and sell the Stock Exchange listed stocks within the scope of the provisions. I hereby organize the knowledge of Hong Kong Stock Connect stocks for your reference, I hope you have gained in the process of reading!
1, Hong Kong Stock Connect stocks will be suspended during trading hours due to stock price volatility?
Answer:Although the SEHK market does not have a trading halt system, there is still a market monitoring mechanism regarding fluctuations in share prices and turnover.
If the Stock Exchange detects through market surveillance unusual fluctuations in the share price or turnover of a listed issuer, or if the media publishes reports that may affect the share price or trading of a listed company, or if there are rumors in the market, then in order to maintain the fairness and orderliness of the market, the Stock Exchange will contact the listed company. The listed company must respond immediately and fulfill its continuing disclosure obligations under the Listing Rules by promptly releasing information relevant to the avoidance of falsehoods in its shares or any inside information that should be disclosed under Part XIVA of the Securities and Futures Ordinance and ensuring that such information is fairly disseminated. A listed company that is not aware of any matter or development that is causing, or is likely to cause, its share price or trading volume to move abnormally should publish an announcement on HKExnews and its website as soon as possible to explain the situation. If the listed company makes such an announcement in a timely manner, there is no need to suspend trading for a short period of time or to suspend trading.
If the situation warrants, for example, if it is discovered or suspected that the price or volume movement is due to the disclosure of certain inside information that is required to be disclosed under Part XIVA of the SFO, the listed company should immediately publicize the relevant information or any inside information that is required to be disclosed under Part XIVA of the SFO. Otherwise, trading in the shares of the listed company may be suspended or halted by the Stock Exchange for a short period of time and resumed after the announcement is made.
A "price or volume movement" in relation to a listed company refers to the abnormal performance of a listed company's share price and/or volume for no apparent reason. For example, a company's share price rises sharply when the market is falling, or turnover suddenly increases sharply. Whether the magnitude of fluctuations in share price or turnover is "abnormal" is a matter for the Exchange to determine by reference to the past performance of the stock in question, the performance of other stocks in the industry to which the stock belongs, and the general situation of the market.
2. Will the Stock Exchange take the initiative to suspend or delist the shares of a listed company?
Answer:The Stock Exchange may, under circumstances and conditions it deems appropriate, direct that the shares of a listed company be suspended, halted or delisted for a short period of time. Specific circumstances include: the issuer (i.e. the listed company) fails to comply with the requirements of the Listing Rules and the situation is serious; there is insufficient public float for the issuer's shares; the issuer is not carrying on business activities or possessing assets sufficient to maintain the continued listing of its securities; and the issuer or its business is no longer suitable for listing.
For Main Board listed companies, a suspension that has lasted for an extended period of time without sufficient action being taken to secure the resumption of trading in the company's shares may result in delisting, i.e., the company's shares are delisted.
Firstly, the Exchange may delist a Main Board company that has been suspended for a prolonged period of time due to serious financial difficulties and/or failure to maintain adequate business operations in accordance with the procedures set out in the Guidance Note on the Application of Rule 17 of the Main Board Listing Rules. If the securities of the listed company have been suspended for six months or more and the relevant Main Board Listing Rules have not been complied with, the Exchange will determine whether the company needs to proceed to the second stage of the delisting process. Listed companies entering this phase will have six months to submit a feasible resumption proposal to the Exchange. If the listed company fails to submit a viable resumption proposal by the deadline, the company will enter the third phase of the delisting process. Upon entering the third phase of the delisting process, the listed company will have a final six months to submit a feasible resumption proposal to the Exchange. If the issuer fails to submit a viable resumption proposal by the end of that period, the listing status of the listed company will be revoked, i.e. delisted.
Secondly, if a company is involved in a regulatory investigation, accounting irregularities, failure to publish financial results, or serious deficiencies in internal controls that result in a suspension of trading under the Listing Rules, the listing will also be suspended in the interest of maintaining a fair and orderly market and public disclosure of information.
Thirdly, the Exchange may also remove a Main Board company from trading under Main Board Listing Rule 6.10. For example, if the Exchange is of the opinion that the Main Board company or its business is no longer suitable for listing, then the Exchange will publish an announcement stating the name of the company and setting out a deadline within which the company must remedy the matters that have rendered it unsuitable for listing.
For example, with the exception of "investment companies" as defined in Chapter 21 of the Main Board Listing Rules and listed companies principally or exclusively engaged in the business of stockbroking, whether on the Main Board or the Growth Enterprise Market (GEM), the Exchange will deem a company to be unsuitable for listing and suspend trading in the stock market if all or a substantial part of the company's assets consist of cash or short-term securities. Suspension of Trading During the suspension period, the company may apply to the SEHK for resumption of trading if it is carrying on a business that is suitable for listing. The Exchange will treat the application for resumption as an application for listing by a new applicant. The Exchange has the right to cancel the listing of a company if the suspension lasts for more than 12 months in such circumstances, or in any other circumstances that the Exchange deems necessary.
3. What is the process of resuming trading after suspension?
Answer: According to the Stock Exchange's Listing Rules, the shares of listed companies should be continuously traded as far as possible, therefore, suspension of trading is only a means to deal with potential and actual special market conditions, and even if a suspension of trading is necessary, the duration of the suspension of trading should be as short as possible.
If a company is suspended by the Stock Exchange, the listed company should make a short announcement to the market explaining the reason for the suspension to increase market transparency. The Exchange will also maintain continuous contact with the listed company during the suspension period and will require the listed company to make an announcement before the resumption of trading.
The exact resumption procedures will depend on the circumstances and the Exchange reserves the right to impose such conditions as it deems appropriate. Generally, the Exchange will resume trading when the listed issuer has made an appropriate announcement or when the specific reasons for the initial request for a brief suspension or trading halt no longer apply; in other cases, the brief suspension or trading halt will continue until the issuer has complied with all the requirements for resumption of trading.
4. Will trading resume immediately after a listed company on the Stock Exchange issues a clarification announcement?
Answer:A SEHK-listed company may resume trading at the beginning of the next trading session after it has announced any information or inside information that would prevent a false market in its shares. The announcement should contain sufficient information to enable trading in the shares to be resumed in circumstances where the information is fair and widely known in the market.
5. What should investors do with their shares in suspended Stock Exchange companies?
Answer:When a company's shares are briefly suspended by the Stock Exchange or after a suspension of trading, investors are temporarily unable to buy or sell during the suspension period. If investors are holding the stock, they should pay close attention to the latest announcement released by the listed company through the HKExnews website for information on the resumption of trading in the company's shares. If a Main Board or GEM listed company has been suspended for 3 months or more, investors may refer to the "Report on Long Suspended Companies" under "Issuer Information" on the HKExnews website to learn more about the company. "for the monthly report of the listed company.
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