SINGAPORE, March 24 Hong Kong's stock market is
well regulated and is not becoming a stock "casino", the CEO of
the stock exchange operator said on Friday after shares in China
Huishan Dairy Holdings plunged 85 percent.
It was not immediately clear what triggered the slide in
Huishan Dairy's stock, which wiped $4 billion from its market
value before trading was halted.
"First of all, Hong Kong capital market is not a stock
casino and let's put the record straight on that," Hong Kong
Exchanges and Clearing Ltd (HKEX) Chief Executive
Charles Li said in response to a question at the Foreign
He was asked how the HKEX was looking to keep a balance
between attracting Chinese money and maintaining a well
functioning market. Li did not specifically mention Huishan
Dairy, but was asked about it by a journalist at the event.
Barron's Asia quoted Huishan Dairy's Chairman Yang Kai as
saying the decline was the result of a short seller attack. The
firm has previously come under attack from U.S. based
short-seller Muddy Waters.
HKEX's Li said the market had seen an increase in different
types of new investors from China, but warned against too much
regulation by the bourse.
"When the market starts to lose its way, then we will come
in," he added.
Hong Kong has tightened listing and takeover requirements,
and stepped up enforcement after instances of erratic price
movements sparked fear of manipulation in the market.
"We all need to relax. This is a great market. You don't
want (the) regulator to solve all your problems," Li said.
(Reporting by Anshuman Daga; Editing by Elaine Hardcastle)