Asian market round up: On a through train

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Asian market round up: On a through train

Hong Kong’s notoriously volatile investors are again set firm in headless-chicken mode (the bullish version). Ever since China’s foreign securities regulator, Safe, announced in August that mainland investors would "soon" be allowed to begin throwing their hard-earned savings at Hong Kong-listed stocks, the local Hang Seng index has been on a superhuman tear.

And it did the trick. On August 17, just before Safe’s edict, the index was trailing at 20,387.13 – roughly the same level as at the beginning of 2007. Within two months, it had added nearly 10,000 points, ending the day on October 24 at 29,333.52. On October 18, the index snuck through the 30,000 mark for the first time, and continued to test the auspicious number over the following week.

So what next for this most topsy-turvy of stock markets? All eyes are still on Beijing for any update on the new mainland investor route, or "through train", as it’s dubbed in Hong Kong. At the moment, everything is up in the air. Following Safe’s announcement, China’s stock regulator, the CSRC, pointedly dismissed the through train plan, saying "serious discussions" were needed to pre-empt fears of a sudden outflow of mainland savings.

Beijing, meanwhile, has been too focused on its National Congress. And on October 17, one of the country’s pre-eminent financial figures, the Bank of China chairman Xiao Gang, said there was no timetable for the through train, leading many to believe that the plan would be stuck in the sidings until at least the first quarter of 2008.

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