Hong Kong markets to open as normal as regulators, government, banks prep contingency plans

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Hong Kong’s Financial Secretary Paul Chan Mo-po met financial regulators and officials from bourse operator Hong Kong Exchanges and Clearing (HKEX) to discuss reopening the stock market as planned on Wednesday, reviewing contingency arrangements as the death toll from the viral outbreak in central China crossed 100.

The move comes even as city officials called on civil servants and private sector employees to work from home the rest of the week because of the outbreak.

The HKEX had already announced it would cancel the annual gathering to celebrate the first trading day of the Year of the Rat because of the increasing risk from the virus.

“The financial secretary appealed to financial organisations to make special work arrangements for their employees as far as practicable, so as to work together to reduce the risk of the spread of the novel coronavirus in the community,” the city’s government said on Tuesday.

The coronavirus outbreak, which is believed to have originated at a wet market in Wuhan in Hubei province, has afflicted more than 4,600 people worldwide and killed more than 100 people.

It has prompted Hong Kong’s government to call for civil servants to stay home until February 2 and urge private sector employees to work from home until then to stop the spread of the virus in Hong Kong.

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The city’s government said on Tuesday that it also would drastically cut cross-border traffic with the mainland, cutting flights, shuttering two rail links and denying entry to individual mainland travellers.

On Monday, the Shanghai Stock Exchange said that it would remain closed until February 3 after the State Council, China’s cabinet, extended the Lunar New Year holiday by two working days in the mainland to help stem the spread of the virus. The smaller Shenzhen exchange in southern China is expected to observe a similar suspension.

The HKEX said markets would be “open as usual” on Wednesday, but there would be no buying of Chinese stocks by international investors, or so-called northbound trades, or trading by mainland investors in Hong Kong shares known as southbound trades under the stock connect programme until the mainland exchanges reopen.

“As the market operator in Hong Kong, we are committed to keeping our markets fully operational and functioning well,” a HKEX spokeswoman said. “Our number one priority as always is the health and safety of our employees, and we are taking appropriate precautionary steps, which include working from home and other flexible steps.”

Following the Hong Kong government’s plea, businesses ranging from major banks to law firms said they would ask non-essential employees to work from home until next week. Several companies also said they would ask employees who had travelled to Wuhan or the mainland to self quarantine for 14 days.

Banks said they would have sufficient staff – whether through split operations or though remote working – for the Hong Kong market to reopen on Wednesday.

A HSBC spokeswoman said the company had “multiple contingencies in place” to handle demand, but declined to elaborate.

“Our first priority and concern is the well-being of our staff and customers. HSBC is operating as normal. We are encouraging employees in Hong Kong to consider working from home, where possible,” HSBC said in a statement. “As an additional safeguard, client-facing employees will all wear surgical masks when on duty.”

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Like many of its banking rivals, HSBC, the largest of three currency issuing banks in the city, has asked employees who have travelled to the mainland or been in contact with people who have travelled to Hubei province to stay home for two weeks. It also has suspended business travel to Hong Kong until February 11 and business travel to mainland China until further notice.

The International Commerce Center tower in Kowloon, where Credit Suisse, Deutsche Bank and other banks have headquarters, remains open, but several banks have since said employees can work flexibly as needed.

Banks have been offering face masks and hand sanitisers to workers and some have offered temperature checks at their offices.

“The health and safety of our employees is our top priority. Credit Suisse monitors global health risks closely and takes measures to ensure that we are providing safe working conditions in our offices,” a Credit Suisse spokeswoman said. “Credit Suisse's Hong Kong office is currently operating normally.”

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