Blackpool stockbroker hails China plan

Neil Jones of Hargreave Hale
Neil Jones of Hargreave Hale
0
Have your say

A Blackpool stockbroker has welcomed a deal between Britain and China which forges closer links between the two countries.

The Chancellor George Osborne gave a speech to an audience at the Shanghai Stock Exchange during his five-day visit aimed at boosting trade with China.

Commenting on Chancellor George Osborne’s announcement that the UK and China are exploring the potential for linking the two countries’ stock markets, Neil Jones, investment manager at Whitehills-based Hargreave Hale, said:“This should be good news for the UK stock market, as prices are driven by supply and demand.

“An increase in the number of investors who can easily buy UK shares should see new money entering the market.

“China is still relatively new to stock market investing, so there could be huge amounts of money to be invested in the future.

“China’s Shanghai stock market should also benefit, assuming corporate governance and listing requirements can develop sufficiently to adhere to UK standards.

“Accessibility and confidence would increase, encouraging more money flow to Chinese markets from around the world. The main note of caution should be in respect of the current approach of Chinese investing, which is very short term in nature and causes the large amounts of volatility which has been apparent recently.

“Coupled with the impact of currency fluctuations on UK share prices, due to possible arbitraging, this could lead to wild gyrations in UK equities.

“As long as there is the necessary harmonisation, this could be very good news for both stock markets.”