CBN丨Southbound capital to Hong Kong doubles to USD110.4 billion in first 7 m...

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Southbound capital flowing into the Hong Kong stock market hit an all-time high in the first seven months of 2025, reflecting investor confidence in the city on the back of surging turnover and a revived pipeline of initial public offerings (IPOs).

Investors in the Chinese mainland snapped up more Hong Kong equities so far this year than in all of 2024, as southbound flows hit HK$866.8 billion up to July, according to data compiled by Wind. That was already 107 percent of last year’s total.

The total value of Hong Kong stocks held by mainland investors had reached record highs and southbound trades accounted for 20 to 30 percent of Hong Kong’s daily turnover, according to a strategist at Everbright Securities International, as many are turning to the Hong Kong market for high-dividend quality names, especially among Chinese enterprises.

The sharp increase in mainland buying came as trading and fundraising activity in the city rebounded strongly after a multi-year slump. The southbound trades via the Stock Connect program accounted for 23.1 percent of total turnover on the Hong Kong stock exchange in the first six months of 2025, up from 18.3 percent from a year earlier, according to a midyear review released by the Hong Kong Securities and Futures Commission (SFC) on Thursday.

In the first half, average daily turnover in Hong Kong jumped 82.2 percent from a year earlier to HK$240.2 billion, the SFC said.

The buoyant sentiment was partly driven by the IPO market, which was experiencing a robust recovery. A total of 42 new listings raised a combined HK$107.1 billion, a sevenfold increase from a year earlier, putting Hong Kong at the top of the global league table, according to the SFC’s report. Four companies raised more than HK$5 billion each, while a batch of seven dual-listed firms together accounted for HK$77 billion in proceeds.

Net purchases via the southbound channel during the first half of the year reached HK$731.2 billion – equivalent to 91 percent of the total for all of 2024, the report showed. All told, the southbound scheme brought in HK$4.42 trillion as of the end of June 30 since its inception, according to the report.

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