HKEX Profit Surge Signals Massive Chinese Capital Inflow and Asian Market Resilience

Hong Kongs financial markets have posted a decisive recovery, with massive capital flows from Mainland China driving record profits and trading volumes. HKEX reported a net profit increase of 36% to HK$17.7 billion (approx. $2.25 billion) for the fiscal year 2025, underscoring a significant shift in regional liquidity dynamics that carries broad implications for the HKD and CNH markets.

• Net Profit: HK$17.7 billion (up 36%)
• Trading Volume: 93% year-on-year increase
• Southbound Stock Connect: Volume jumped 151%
• Global IPO Capital: $287 billion raised in 2025

Surge in Liquidity and Mainland Flows

The standout data point for macro analysts is the 93% year-on-year increase in trading volume. This liquidity injection is heavily supported by the “Southbound” Stock Connect scheme, where volume jumped 151%.

This metric implies a robust channel of capital moving from Mainland China into Hong Kong dollars/assets, effectively creating a structural bid for the HKD and suggesting that domestic Chinese investors are aggressively seeking diversification within the SAR. For Forex traders, this heavy south-bound flow can act as a counterbalance to capital flight fears, stabilizing regional sentiment.

IPO Renaissance and Offering Strength

Reclaiming its status as the worlds top listing venue, HKEX capitalized on a global IPO market that raised $287 billion globally in 2025.

• Chinese Dominance: Mainland firms accounted for roughly 70% of proceeds in Hong Kong.
• Key Listings: Major deals, including a $5.3 billion sale by Contemporary Amperex Technology Co., highlight that despite geopolitical friction, large-cap Chinese heavyweights retain the ability to mobilize significant foreign capital.

Analyst Perspective: Capital Diversification

HKEX Chief Executive Bonnie Chan noted that global investors are increasingly using Asian assets for risk management and diversification. However, the exchange also flagged a high volume of “substandard applications” among its 400 active pipeline entries, suggesting that while quantity is returning, quality control remains a regulatory focus.

For the broader currency market, the resurgence of Hong Kong as a capital hub suggests that the USD/HKD peg remains supported by genuine transactional demand and investment inflows, countering bearish narratives involving the region's financial decoupling.