China will soon cease displaying real-time data for flows into the world’s second-largest stock market through Hong Kong, cloaking a closely watched indicator of foreign sentiment.

Live trading data for flows from Hong Kong into Shanghai and Shenzhen via the connect programmes will no longer be available in about a month, according to statements by the two mainland stock exchanges late last Friday. Instead, they will provide the turnover details after the daily sessions.

The changes are to align Chinese practices with other global exchanges, the two bourses said. “There is no intraday real-time data on the trading of a certain group of investors in European, US and other developed markets, nor do those markets distinguish between local and international investors in data disclosure,” they said.

Still, the move may mark another attempt by Chinese policymakers to prop up a market that had suffered from both a loss of retail confidence and the withdrawal of foreign money managers over the past year. Selling by global funds was seen as exacerbating pessimism during the rout, with some participants calling last year for the authorities to obscure intraday flow figures. 

In March, the daily average amount of mainland stocks traded via the exchange links accounted for around 14% of the total turnover of the mainland stock markets.

“Investors are set to end up with one less window into watching the market, and it will take some time to adjust to,” said Yan Kaiwen, an analyst at China Fortune Securities Co. “But this is another way via which regulators are guiding investment focusing on the longer term.”

Chinese stocks gained on Monday as a slew of renewed regulatory support from Beijing shielded the market from a broader sell-off hitting Asia. The benchmark CSI 300 Index jumped 2.1%, while an MSCI gauge of Asian shares slipped.

Looking across the region, Taiwan’s bourse publishes foreign stock flow numbers once a day. South Korea discloses the data in real time and on a more granular level, while Japan releases the data on a weekly basis. 

Other data such as purchases of exchange-traded funds and details of the top 10 most-traded stocks will be shown after the daily session, unchanged from the current disclosure rules. 

The exchanges said they will publish real-time quota remainder data only when more than 70% of the daily amount is used up. The northbound connect programmes allow for daily flows of 104 billion yuan (US$14 billion or RM68.65 billion), and around 11% of that quota was used up in Shanghai and Shenzhen on Monday. Foreign investors bought a net 8.1 billion yuan worth of shares, the most in a month.

This is not the first time regulators pay attention to highly-volatile intraday data. In June last year, the nation’s actively managed mutual funds were asked to stop displaying real-time estimates of their products' net value, a move to guide retail traders towards adopting a longer-term investment view and reduce speculative positioning.

Earlier in the year, the stock-connect intraday data was also analysed by market watchers for signs of potential intervention by state-backed funds based in Hong Kong. The so-called National Team, including sovereign wealth fund Central Huijin Investment Ltd, had bought around US$50 billion of the nation’s equities in the five months through mid-March, according to an analysis by Bloomberg Intelligence. 

Foreigner ownership of individual companies via the trading links will no longer be updated daily. Instead, the data will be released five trading sessions after the end of the quarter, the exchanges said in Friday documents. Mainland investors’ holdings of Hong Kong stocks will continue to be issued daily.

Bloomberg calculates net flows via the trading links on an intraday basis based on buy and sell turnover released in real time by the exchanges. 

  - Bloomberg