The Hong Kong market was aflutter yesterday with the news that the Hong Kong and Shanghai stock markets are hatching a plan to trade each others' shares, in a new scheme that will further open up China's capital market.

Yesterday, the China Securities Regulatory Commission and the Hong Kong Securities and Futures Commission announced the creation of a trading link between Hong Kong Exchanges & Clearing and the Shanghai Stock Exchange, dubbed "Shanghai Hong Kong Stock Connect", a pilot programme that will establish mutual stock market access between Hong Kong and mainland China.