According to the Zhitong Finance and Economics APP, Ubs issued a report indicating that due to the cyclical downturn in the residential market, the bank is more bullish on developers than house rental companies, as strong rental growth indicates a healthy potential supply/demand. The bank expects that as interest rates become more favorable, real estate sales and prices are stabilizing. Tung (01972), Henderson Land (00012), and Kerry PPT (00683) are its top picks.

Ubs stated that Hong Kong's retail sales in August decreased by 10.1% year-on-year, reaching only 29 billion Hong Kong dollars, slightly lower than the market consensus forecast of a 9% year-on-year decline, but the annual decline narrowed slightly. The bank estimates that a large number of Hong Kong residents have traveled abroad. On the other hand, the data shows that the number of mainland tourists in August remains at 3.7 million, a 7% increase from the same period last year (July: +6%), and has returned to 76% of the level in August 2018. Almost all product categories saw a decrease in sales compared to the same period last year, except for pharmaceuticals and cosmetics (+5%). Among them, luxury goods had the largest decline at -24%, followed by department stores (-16%), durable consumer goods (-16%), and outfits (-12%). In contrast, food and supermarkets performed relatively well, with -4% and 0% growth, respectively.

The bank expects that the market has already absorbed the weakness in retail sales in August, and the strong influx of mainland tourists to Hong Kong during the National Day holiday should benefit the operators of tourist areas, namely Wharf REIC (01997) and Hysan Dev (00014).