Jianyin International predicts that the Hang Seng Index will fluctuate between 17,500 and 22,500 points in the second half of the year.

AASTOCKS ·  Jun 7 15:49

Zhao Wenli, Managing Director, Director of Research Department, and Chief Strategist of Jianyin International Securities Research Department, stated that the Hong Kong stock market has experienced a rapid rebound since mid-to-late April and ushered in a technical bull market. There may be pressure on short-term adjustments. If the Hang Seng Index stabilizes at 18,000 points, it will indicate the true completion of the bear market to bull market conversion.

He expects that the Hong Kong stock market will continue to rise in the third quarter, and there may be fluctuations in the fourth quarter. It is expected that the Hang Seng Index will hover between 17,500 and 22,500 points in the second half of the year, while the Mainland Enterprise Index and the Technology Index are expected to be between 6,000 and 7,000 points and 3,500 to 5,000 points, respectively.

The bank recommends investors to focus on spotlight stocks in the second half of the year, including Tencent (00700.HK), Meituan (03690.HK), BYD Electronic (00285.HK), CM Bank (03968.HK), Anta Sports (02020.HK), Geely Auto (00175.HK), CRRC Corporation (01766.HK), CNOOC (00883.HK), Zijin Mining Group (02899.HK), and Innovent Bio (01801.HK).

Regarding sector selection, Jianyin International is bullish on the internet industry, with a preference for gaming, local life, and undervalued e-commerce, as well as new energy vehicles, consumption, consumer electronics, biomedical, mining and commodities, undervalued high dividend defensive stocks, and new quality productivity investment themes.

He also pointed out that the current valuation of the Hong Kong stock market has repaired to a forecasted price-to-earnings ratio of about 10 to 11 times, plus improved liquidity, and it is expected that the Hong Kong IPO market will rebound in the second half of the year compared to the first half. In addition to benefiting from the decline in risk-free interest rates, the future stock market's rise also requires the support of corporate profit recovery.

The translation is provided by third-party software.

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