Japan Exchange Wants to Join Hong Kong-Shanghai Stock Link

(Bloomberg) — Japan Exchange Group Inc., the countrys main bourse operator, wants to join the planned equity-trading link between Hong Kong and Shanghai.

The Chinese market is very important for us; we will try to be part of this link, Hiromi Yamaji, the chief executive officer of Osaka Exchange Inc., a unit of Japan Exchange, told reporters in Hong Kong. Yamaji did not specify how the operator of the Tokyo Stock Exchange intends to join the trading link.

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The Hong Kong and Shanghai bourses have finished work on a trading connection that will enable foreigners to directly buy more mainland shares. Chinese investors will be able to trade in Hong Kong stocks using the system, which still needs approval from the Chinese leadership.

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China is perceived as a holy grail of investment opportunities for the global capital markets, Andy Nybo, the head of derivatives research at New York-based Tabb Group LLC, said in a phone interview. Getting involved with the Shanghai and Hong Kong exchanges in the early stages gives them a seat at the table, gives them access to strategic decisions being made by the regulatory authorities.

Japan Exchange opened an office in Hong Kong this month with the aim of expanding its operations. Japans Prime Minister Shinzo Abe and Chinas President Xi Jinping both attend the Asia Pacific Economic Cooperation summit that starts in Beijing on Friday.

I hope that at the APEC meeting in Beijing, Mr. Abe is going to see Mr. Jinping, Yamaji said. We are quite open- minded to establish those kinds of relationships with exchanges in China, but at this moment we dont have any imminent plans to do it.