Chip boom powers Hong Kong stock exchange at 40. Innovation, resilience set next stage

Stepping into the former trading hall in Exchange Square on Thursday was like walking through a doorway into the 1980s. The gong-striking ceremony marking the 40th anniversary of the merger that created the Stock Exchange of Hong Kong felt both nostalgic and pointedly forward-looking. That merger, which consolidated four separate exchanges into one unified SEHK, was a bet on scale and credibility. It paid off. Today, the exchange is riding a different kind of wave. Hong Kong is reaping the rewards of the semiconductor supercycle. An explosive surge in memory chip demand, fueled by the artificial intelligence boom, has turned the city into a critical offshore fundraising platform for China’s next generation of tech companies. As global investors look for exposure beyond US technology giants, Hong Kong is well positioned to attract listings from semiconductor, AI compute, robotics, and advanced manufacturing firms. The pipeline is real. But the rally masks a narrow base. The Hang Seng Index and the Hang Seng Tech Index have both eased so far this year—down 1.7 per cent and 11 per cent respectively. The chip-driven momentum has not lifted all boats. Baidu’s chip unit Kunlunxin, for instance, is preparing for a Hong Kong listing later this year, even as it pursues a separate IPO in Shanghai. That dual-track approach signals something: even the most promising chip firms see Hong Kong as one option among many. The deeper concern is that Hong Kong’s next phase of competitiveness will depend on moving beyond being simply an IPO venue. The exchange has long been a gateway for mainland capital, but that role is being tested. The mainland’s own stock markets are more liquid and increasingly welcoming to tech listings. Hong Kong needs to offer more than just a listing—it needs to offer depth, derivatives, and a reason for companies to stay listed long after the gong has been struck. Henry Wu King-cheong, a committee member of the exchange back in 1986, offered a quiet reminder that the city should not worry about competition. The merger he helped oversee was itself a response to fragmentation and doubt. “We combined the four exchanges to create the Stock Exchange of Hong Kong, with a new trading hall, telephones and other equipment for trading,” he recalled. That same spirit of consolidation and modernization is what built investor confidence. What a casual observer might miss is that the current chip boom is not just about AI demand. It is also about geopolitics. As the US tightens export controls and restricts technology flows, Hong Kong becomes a crucial conduit for mainland chip companies seeking international capital without crossing American red lines. That makes the exchange both a beneficiary and a hostage of forces beyond its control. The 40th anniversary speech carried a clear echo of the founding vision: integrity, innovation, and an unwavering commitment to keeping Hong Kong open, connected, and ready for the next 40 years. That is a tall order. The exchange has already proven it can adapt through crises—financial, political, and pandemic. The next test will be whether it can diversify its listings beyond a single, albeit booming, sector before the supercycle fades.

Stepping into the former trading hall in Exchange Square on Thursday was like walking through a doorway into the 1980s.

Hong Kong’s chip-driven rally masks a narrow base; sustained growth depends on broadening listings beyond a single sector.

The development adds to a wider Hong Kong semiconductors story in which companies are being judged on execution, capital access, regulatory fit and the credibility of their regional expansion plans.

For business readers, the important question is whether this becomes an isolated announcement or part of a more durable operating pattern across customers, financing channels, partners and public-market expectations.