HSBC Research's report pointed out that the performance of Chinese stocks listed in Hong Kong has been steady this year, and Asia's funds have turned neutral. The real estate developer Vanke (02202.HK) which was short of funds received credit financing last month, which may indicate that the central government is shifting from deleveraging the real estate industry to more constructive methods. Although confidence in the domestic market is still lacking, the family deposit size is twice that of the A-share market, reaching a new high. This suggests that even if domestic confidence improves slightly, such as cash flow returning to the domestic stock market, it may have a huge impact on the Chinese stock market. The bank rates the Chinese stock market as "shareholding".
Regarding Hong Kong, the bank believes that real estate stocks, one of the important supports of Hong Kong stocks, has faced many challenges in the past few years, but property industry has improved significantly with rising transaction volume after comprehensive restrictions on the property market have been lifted. Therefore, the bank holds a "neutral" view on the Hong Kong stock market. However, the Hong Kong property market is still in a destocking cycle. Compared with the rebound in housing prices, developers are more concerned about clearing unsold units that have been completed, and the initially soaring transaction volume has weakened. The bank expects that the property market will still be under pressure for the rest of this year and is expected to have a slight rebound next year.
Looking ahead, the bank has a mixed outlook on the Hong Kong stock market. It is estimated that the low point of the property market has passed and it will gradually recover, thereby mitigating the degree of drag on the Hong Kong economy. At the same time, by expanding various interconnection plans, strengthening the link between the onshore market and the offshore market, it is expected to introduce new liquidity that can further promote the growth momentum. However, Hong Kong still faces the challenges brought by the high-interest environment and the cyclical transformation of the Chinese economy, both of which bring less optimistic prospects for Hong Kong enterprises. The bank found investment opportunities in banks, exchanges, and high-quality developers. Real estate investment trusts will benefit from a large investor base and better liquidity after being included in the Shanghai-Shenzhen-Hong Kong Stock Connect plan. The bank raises the Hang Seng Index year-end target from 19,230 points to 19,810 points.
In addition, the bank is bullish on the Indian market, which continues to provide strong and stable profit growth. There were no major adjustments to important cabinet positions in the recent elections, so it is believed that policies will continue to focus on capital expenditures to ensure that growth remains on track. The bank believes that foreign funds will buy Indian stocks on dips. The bank downgraded the rating of the Indian stock market from "shareholding" to "neutral".
Regarding South Korea, the bank pointed out that the memory industry has sufficient growth opportunities, and the "corporate value enhancement plan" has attracted much attention. The bank raises the rating of the South Korean stock market from "neutral" to "shareholding".