Hong Kong looks at shorter lunch break


Hong Kong has some of the shortest hours in the world, and was the worst performing major index in Asia in 2001

By Alex Frew McMillan

HONG KONG, China (CNN) -- Market watchers expect a vote to extend trading hours at the Hong Kong Stock Exchange later Wednesday.

The proposal under consideration is thought to include trimming the lunch-break to one hour, from two.

The board may also extend trading by one hour, to 5 p.m. Hong Kong has one of the shortest trading days in the world.

But the extension still would not bring it in line with the world's biggest markets. The exchange has apparently given up on a motion tabled last year to scrap lunch altogether and trade for eight hours straight, possibly with a night session.

The parent company of the stock exchange, Hong Kong Exchanges and Clearing Ltd., reports its full-year earnings for 2001 at 6 p.m. local time Wednesday.

Local media report an extension of the hours is also imminent.

Intense competition ahead

The exchange faces increased pressure from technologically advanced boards in Shanghai and Shenzhen, which are only a decade old and developed fully computer-driven systems.

Hong Kong's hours also put it well behind markets like the United States, where after-hours trading on electronic communications networks such as Archipelago and Instinet mean that serious traders can sell or buy anytime, anywhere.

Hong Kong currently offers just four hours of trading, from 10 a.m. to 12:30 p.m. and resuming at 2:30 p.m. through 4 p.m.

But extending hours plays into the hands of large brokerages and would be resisted by smaller trading shops. They have less staff to cover a longer trading day.

Still, markets in Japan, Taiwan and South Korea have already or are considering extending hours. The Singapore stock market has partnered with Australia's main market in Sydney, allowing cross-listings.

A spokesman at Hong Kong Exchanges and Clearing said the company had "no comment" on whether or not a vote was coming or even whether such a move had been tabled.

Hong Kong was the worst performing major market in Asia last year, in part due to its currency peg to the U.S. dollar and its strong trading ties with that country.

The main Hong Kong index, the Hang Seng, was down 0.41 percent at 11,227.27 just after noon local time.