China to permit cross-border stock trading between Shanghai, Hong Kong exchanges

China has unveiled a plan that would give foreign investors greater access to its stock market by allowing investors in Shanghai and Hong Kong to trade shares on each other's exchanges.

Securities regulators in mainland China and Hong Kong said on Thursday that the stock exchanges in both cities would be connected in a pilot program.

Authorized investors in Shanghai and Hong Kong will be able to buy and sell up to 23.5 billion yuan ($3.8 billion) of stocks on each other's exchanges each day.

Only shares of certain companies will qualify for the program, which will launch in six months.

The regulators said the move will help open up China's tightly controlled capital market and promote the use of China's currency outside of the mainland.