HKMA Defends Currency Peg, Three New Issues Start Trading on Hong Kong Exchange

Li Chen
26 Jun, 2025
Hong Kong

China and Hong Kong stock market indexes lacked direction amid heightened geopolitical tensions and a lack of progress on U.S. tariff negotiations. 

The Hang Seng index fell 0.5%, and the mainland-focused CSI 300 index decreased a fraction, as investors focused on multiple headwinds, including U.S. tariff negotiations. 

Negotiations with the U.S. have stalled over the last week as China pushes for lower tariffs, and the U.S. demands a stable supply of rare earth materials. 

In Hong Kong, the movement in the currency market also garnered investor attention, as the Hong Kong Monetary Authority moved to keep the exchange rate within the target band. 

The HKMA sold the equivalent of US$1.2 billion and purchased Hong Kong dollars at an average price of HK$7.85. 

The currency regulatory authority swiftly moved to keep the currency in the preferred range and took action for the first time since 2023.

The HKMA move also pushed up the interbank rate, which pushed up mortgage rates in the city, dampening property stocks. 

 

China Indexes and Stocks 

The Hang Seng index decreased 0.5% to 24,357.56, and the mainland-focused CSI 300 index decreased 0.1% to 3,959.80. 

Residential property developers declined after the HKMA's move pushed up mortgage rates. 

China Vanke Co. Ltd. decreased 0.2% to HK $4.97, Longfor Group Holdings added 0.4% to HK $9.70, Henderson Land Development Co. Ltd. dropped 2.6% to HK $28.0, and Sun Hung Kai Properties Ltd. fell 2.4% to HK $90.75. 

Three companies listed their shares on the Hong Kong Stock Exchange amid strong interest from retail investors. 

Eternal Beauty Holdings dropped 10% to HK$2.57, and the maker of personal care products sold 333.4 million shares at a price of HK$2.88 per share and raised HK$960.2 million. 

Zhou Liu Fu Jewellery soared 17% to HK $27.60 after the company priced its offering at HK $24.0 per share. 

The jewelry company sold 53.83 million shares and raised a total of HK $1.29 billion. 

Saint Bella jumped more than 35% to HK $9.0 after the maker of child and elderly care products priced its public offering at HK $6.58 per share. 

The company sold 109.7 million shares in a global offering and raised a total of HK $722.04 million.