subject: A Brief History Of The Tokyo, Hong Kong And Shanghai Stock Exchanges [print this page] The influence of the Asian stock market is ever increasing. Asian Stock Market Investments are now popular for traders all over the world. The three biggest stock markets in Asia are Tokyo, Hong Kong and Shanghai. Here we take a look at the history of these three stock markets.
TOKYO
The Tokyo Stock Exchange (commonly known as the TSE) is Asias largest stock market. It was first established in 1879, and gradually grew in importance over the course of the next sixty years. During this period it collaborated with several other stock exchanges across Japan, and by the 1940s was combined with ten others. These partnerships ceased after World War 2. During the war trading stopped. The Tokyo Stock Exchange once again opened for business in 1949. It saw major success in the 1980s and for a time accounted for over 60% of the worlds stock market capitalisation. In 1990, though, it crashed in a major way. It has since recovered and is currently the world second largest stock exchange after New York.
HONG KONG
Informal security exchanges have been taking place in Hong Kong since 1861. The Hong Kong Stock Exchange (HKSE) was opened thirty years later under the name of the Association of Stockbrokers in Hong Kong. In 1914 it was renamed the Hong Kong Stock Exchange. In 1921 a separate Hong Kong Stockbrokers Association was founded but this later merger with the HKSE. Between 1969 and 1972 three other organisations were founded; the Far East Exchange, the Kam Ngan Stock Exchange and the Kowloon Stock Exchange. Although they all operated independently of each other they did, along with the HKSE, share information. Eventually they all merged. Hong Kong is the second largest stock exchange in Asia.
SHANGHAI
The Shanghai Stock Exchange (SSE) differs to Tokyo and Hong Kong in that it is not entirely open to foreign investors, although they do play their part. This is because of tight capital account controls by the Chinese authorities.
Securities trading first began in 1866 in Shanghai but a stock exchange was not established until 1891. In that year there was a boom in mining shares and foreign businessmen founded the Shanghai Sharebrokers Association, the first Chinese stock exchange. In 1904 it was renamed the Shanghai Stock Exchange. In the 1920s, in place of the SSE, the Shanghai Securities and Commodities Exchange and the Shanghai Chinese Merchant Exchange started operating independently. They combined again in 1929, and Shanghai became the financial centre of the Far East in the 1930s, with significant Chinese and foreign investment. During World War 2, the Japanese invaded the Shanghai International Settlement in late 1941. The stock exchange was closed between 1941 and 1946. It then opened again for three years before closing during the Communist revolution in 1949. It wasnt re-established again for over four decades, in 1990. A successful decade followed with a 2001 peak, but this was followed by a four year slump in which its value halved. It reached another high in 2007 but has fallen since due the global economic conditions.
