HONG KONG • The stock exchange operator of Hong Kong posted a 13 per cent rise in second-quarter net profit, beating analysts' estimates, bolstered by a surge in trading and stock listing fees.

Hong Kong Exchanges & Clearing (HKEX), the world's No. 1 initial public offerings market in 2015 and 2016, is benefiting from an improvement in investor sentiment that has translated into higher trading activity.

It reported yesterday a profit of HK$1.8 billion (S$314 million) for its fiscal second quarter ended in June, up from HK$1.6 billion in the same period last year. That compared with the HK$1.6 billion average forecast of analysts, as per Thomson Reuters data.

Rival Singapore Exchange last month also posted a higher quarterly net profit. As competition with other leading global stock listing venues has intensified, HKEX is leveraging its role as a gateway to China's investors to boost revenue.

The bourse last month unveiled a proposal for a new listing board that will offer special voting rights and waive profitability rules, aiming to attract secondary listings from Chinese firms that typically choose New York over Hong Kong.

HKEX is also trying to boost its commodities business through the launch of new products by its LME platform. It is expected to benefit from the recent launch of a bonds cross-trading system with China.

"We are pleased to see that our mutual market access programme continues to contribute to China's capital market development and consolidate Hong Kong's gateway position connecting China and the rest of the world," HKEX chairman Chung Kong Chow said in an earnings statement.

HKEX's average daily turnover in the cash market for the second quarter was HK$77.8 billion, up 5 per cent compared with the year-ago period. Stock listing fees rose 7 per cent in the first half-year to HK$398 million, it said.

REUTERS