London Daily

Focus on the big picture.
Tuesday, Jun 23, 2026

An epic year of market events shook China, Hong Kong and Taiwan

An epic year of market events shook China, Hong Kong and Taiwan

China, Hong Kong and Taiwan’s economies were among the first to suffer from the virus pandemic. They were also home to some of the most dramatic events in global financial markets this year.

Take China’s equity market, whose value topped $10 trillion for the first time since the 2015 crash and where a liquor-maker became the country’s most valuable stock. The yuan tested a record low offshore before commencing a rally that some say could take the currency to levels not seen since 1993.

In Hong Kong, colonial stalwart HSBC Holdings PLC fell to its lowest price since 1995 before becoming one of the city’s best trades. Record foreign inflows into Taiwan’s technology shares were so intense that the central bank had to intervene almost daily to rein in its strongest currency in more than two decades.

Here are some of the year’s biggest financial-market events in China, Hong Kong and Taiwan, a region at the forefront of the global recovery.

Comeback currency


Concern over the impact of COVID-19 on China’s economy triggered a slump in the yuan from mid-January. The currency tested its all-time low in offshore trading just four months later. But in the half-year since, it has surged to near the 6.5 mark, with Citigroup Inc. chief China economist Liu Li-gang predicting it could rally past 6 next year — a level it hasn’t breached since 1993. Capital inflows into stocks and bonds are also boosting the yuan, posing a challenge to China’s central bank, which doesn’t want a stronger currency to harm an export-driven recovery.

Ant squashed


Days before Ant Group Co. was due for the biggest stock market debut ever seen, Chinese regulators abruptly halted the $35 billion initial public offering. Many observers concluded that the move was aimed at humbling both the Alibaba Group Holding Ltd. behemoth and its founder, billionaire Jack Ma, who at a Shanghai conference in October criticized China’s state-owned banks. The immediate reaction in the financial market reduced Ma’s fortune by almost $3 billion. Beijing last month also issued rules to root out internet monopolies and began scrutinizing investments in new energy vehicles.

Bust to boom


Resuming trade after an extended Lunar New Year break as the coronavirus outbreak worsened, Chinese equities were hit by a brutal wave of selling in February. More than 3,000 stocks went limit down in their worst day since the 2015 bubble burst. At that point it would have taken a strong stomach to predict that only five months later, China’s recovery in the face of the virus would propel a frenzy that would add $1 trillion to the market’s value in an 8-day period. That rally set the stage for the stock market to finish out the year stronger than it started.

Chinese defaults


A spate of defaults by China’s state-linked firms took investors by surprise in November, after months of support to curb the fallout of the coronavirus helped prevent a wave of payment failures earlier in the year. A focus on state-owned enterprises marks a shift away from private firms to the mammoth state sector — these borrowers dominate the nation’s onshore bond market and were once considered guaranteed to receive a bailout. The historic repricing of risk among weaker-rated SOEs has some investors now seeing 2021 as a potential inflection point for the emergence of a genuine credit risk mechanism in the world’s second-largest bond market.

H.K. markets steady


Beijing’s passing of a sweeping national security law in June elicited global condemnation, but it has been mostly business as usual for markets in the former British colony. While the benchmark Hang Seng Index is down by 6% this year, capital inflows have remained steady and a record number of companies raised $1 billion or more from initial public offerings, including JD Health International Inc.’s $3.5 billion December listing. The Hong Kong dollar has remained strong in the face of economic and political pressure, including when U.S. President Donald Trump aides aired the idea of undermining its peg to the greenback. The city’s de facto central bank undertook a record intervention to prevent the Hong Kong dollar strengthening past the permitted range with its U.S. counterpart.

Taiwan tensions?


Concerns about a possible Chinese military invasion were heightened, but you wouldn’t know it from looking at Taiwan’s markets. Chipmaker Taiwan Semiconductor Manufacturing Co. briefly entered the world’s top 10 companies by market value and its shares are up more than 50% this year. The domestic benchmark stock index has been hitting record highs since July, surpassing the 14,000-point level for the first time in early December. The Taiwan dollar has recently reached its strongest level against the U.S. dollar since 1997, with the central bank apparently shifting from its previous “smoothing” strategy to a managed appreciation.

Shot: HSBC. Chaser: Moutai.


One of the most whiplash-inducing rebounds of the year was HSBC, which ran afoul of U.K. regulators, core investors and Chinese officials and saw its Hong Kong shares lose more than 50% of their value between February and late September. It promptly bounced back as much as 55% on better-than-expected third quarter results and a plan to return to dividend payouts, making it one of Hong Kong’s best-performers in the fourth quarter. And then a moment befitting 2020: baijiu distiller Kweichow Moutai Co Ltd. dethroned Industrial & Commercial Bank of China Ltd. as the biggest mainland stock by market value.

Newsletter

Related Articles

0:00
0:00
Close
Taxpayer Support Grows for Higher Digital Levies on Multinational Tech Companies
Bank of England Signals Caution Over Inflation Despite Easing Energy Prices
Lloyds Banking Group Expands Artificial Intelligence Hiring Amid Sector-Wide Automation Shift
Film Producer Corporate Collapse Leaves Creditors Facing Unrecoverable Losses
UK Ten-Year Brexit Anniversary Highlights Ongoing Political and Economic Uncertainty
Nottingham Maternity Scandal Inquiry Reveals Systemic Failings in NHS Care
Met Office Heatwave Prompts Public Health Warnings Across United Kingdom
Concerns Rise Over Fiscal Stability as Political Uncertainty Weighs on UK Borrowing Costs
UK Taxpayers Back Higher Digital Taxes on Global Technology Firms, Survey Shows
Bank of England Holds Interest Rates Steady Amid Persistent Services Inflation
Reform UK and Opposition Leaders Call for General Election Following Starmer’s Departure
Ten Years After Brexit Referendum, UK Faces Ongoing Political Fragmentation and Economic Debate
Nottingham University Hospitals Maternity Inquiry Exposes Severe NHS Failures
Met Office Issues Heat Health Alerts as United Kingdom Faces Record-Breaking Temperatures
Andy Burnham Emerges as Front-Runner for Labour Leadership After Starmer’s Resignation
Keir Starmer Resigns as UK Enters New Phase of Political Leadership Transition
UK Expands Alcohol Ban Enforcement Using Tagging Technology Ahead of World Cup
UK Invests £50 Million in Critical Minerals Supply Chain Security
UK Appoints Special Envoy on Preventing Sexual Violence in Conflict
UK Introduces Fines for Landlords of Unsafe Rental Properties
Reform UK Leads Opinion Polls as Immigration Debate Reshapes UK Politics
Police Investigate Edinburgh Attacks as Potential Hate Crimes
King Charles to Publish Personal Tax and Royal Household Financial Records
Nottingham University Hospitals Maternity Inquiry Report Set for Publication
Heat-Health Alerts Issued Across London and Southern England Amid Rising Temperatures
UK Economy Shows Pressure From Middle East Conflict Despite Modest Growth
Brexit Anniversary Reignites Debate Over UK Economic and Political Direction
UK Parliament Continues Legislative Work Amid Leadership Transition
Financial Markets Hold Steady After UK Leadership Shake-Up
Andy Burnham Enters Labour Leadership Race With Strong Parliamentary Backing
Keir Starmer Resigns as UK Prime Minister After Two Years in Office
Reform UK MP Lee Anderson to Raise Pension Concerns Over British Coal Staff Superannuation Scheme
UK Parliament to Debate Newborn Screening for Spinal Muscular Atrophy Following Public Petition
Met Office Warns of Water Safety Risks During Heatwave as Temperatures Peak in England
Treasury Increases Mileage Allowance Payments for 2026–27 Tax Year to 55 Pence Per Mile
UK Government Raises Electricity Generator Levy to 55 Percent in New Revenue Measure
House of Lords Moves Financial Services and Markets Bill to Committee Stage Amid Regulatory Scrutiny
Westminster Hall to Debate Petition on Pro-Israel Influence in UK Politics
UK Parliament Prepares for Estimates Days Debates as Backbench Business Schedule Approved
Armed Forces Bill Nears Final Stages in UK House of Commons With Military Justice Reforms
Donald Trump Comments on UK Political Situation, Citing Immigration and Energy Policy Concerns
Andy Burnham By-Election Victory Fuels Speculation Over Potential Labour Leadership Contest
UK Economy Shows Resilience but Faces Headwinds from Middle East Tensions, UK Finance Says
UK Parliament Opens Week of Debates on Net Zero, Security and Armed Forces Reform
Met Office Issues Amber Extreme Heat Warning as Temperatures Expected to Reach 35C Across England and Wales
Prime Minister Keir Starmer Faces Mounting Leadership Pressure After Makerfield By-Election Defeat
London Hotel Wins World’s Best Afternoon Tea Award at International Hospitality Guide La Liste
Court of Appeal Rules in Favour of Competition and Markets Authority in Phenytoin Drug Case
Chichester Waste Site Suspended After Environment Agency Finds Serious Fire and Pollution Risks
UK Appoints Chris Elmore as Special Envoy on Preventing Sexual Violence in Conflict
×