The Securities and Futures Commission (SFC) and Hong Kong Exchanges and Clearing Limited (HKEx) wish to remind Exchange Participants and investors of possible increases in trading activities and the risk of unusual price movements around month-ends, quarter ends, and half-year ends, such as 30 June 2008.

The SFC and HKEx are aware of possible increases in trading activities and unusual price movements around the close at these times as well as during index rebalancing events and expiration of derivatives contracts.  Exchange Participants and investors should be mindful of these market events when making investment decisions.

In light of share price movements during the closing auction session at HKEx on 30 May 2008, the SFC has conducted a thorough review with over 100 inquiries into the trading activities. The SFC is continuing to follow up a number of responses with more questions to both local and overseas investors who participated in the closing auction session.

Given the widespread public interest in ensuring fairness and transparency in the market, the SFC will conduct another, equally thorough review of the closing auction session next Monday, 30 June 2008 - the half-year end of 2008.

The SFC will take appropriate enforcement action where misconduct is detected.

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