In the third quarter of 2024, public funds did not make significant changes to their investment strategy in the Hong Kong stock market, continuing to reduce positions in high dividend stocks, especially those with large gains in energy and materials. They mainly increased holdings in optional consumer sectors such as the internet, and slightly increased positions in sectors like autos and manufacturing.
According to the Wisdom Finance app, Haitong Securities released research reports stating that Hong Kong stocks had the highest decline in October, mainly due to previous rapid increases, slight domestic economic turbulence, and the contest between long and short positions in the market. In the third quarter of 2024, public funds did not make significant changes to their investment strategy in the Hong Kong stock market, continuing to reduce positions in high dividend stocks, especially those with large gains in energy and materials. They mainly increased holdings in optional consumer sectors such as the internet, and slightly increased positions in sectors like autos and manufacturing. From the perspective of concept sectors, in the third quarter of 2024, funds mainly increased holdings in Hong Kong internet, CRO, and biotechnology, while reducing positions in Hong Kong energy, high dividend, and durable consumer goods sectors.
The main points of Haitong Securities are as follows:
Market Review: Most global major stock indices declined in October, with Hong Kong stocks experiencing a significant drop.
Regarding A-shares: The CSI 300 Index had a cumulative / maximum decline of -3.2% / -15.4% in October, while the Chinext Price Index had a cumulative / maximum decline of -0.5% / -21.3%. As for Hong Kong stocks, the Hang Seng Index had a cumulative / maximum decline of -3.9% / -14.0%, and the Hang Seng Tech Index had a cumulative / maximum decline of -5.3% / -20.8%. In terms of industry performance, all Hong Kong industries declined in October, with the top three industries in terms of decline being daily consumption (-14.6%), healthcare (-11.8%), and real estate (-11.8%).
Regarding US stocks, the S&P 500 Index had a cumulative / maximum increase of 0.9% / 3.6%, while the Nasdaq Index had 2.3% / 5.7%. In other markets, the German DAX had a cumulative / maximum decline of -0.3% / -2.4%, the UK FTSE 100 had a cumulative / maximum decline of -0.9% / -2.9%, the French CAC 40 had a cumulative / maximum decline of -2.7% / -3.6%, and the Nikkei 225 Index had a cumulative / maximum increase of 3.1% / 6.9%.
In the third quarter of 2024, public funds slightly increased their positions in Hong Kong stocks, resulting in a decrease in concentration of holdings.
In the third quarter of 24, public funds have slightly less issuance of Hong Kong stock mutual funds than the second quarter, and the pace has fallen since the peak in May. From the perspective of the overall position, public funds have slightly increased their shareholdings in Hong Kong stocks. As of the third quarter of 24, the proportion of market cap of Hong Kong stocks in the heavyweight stock holdings of actively biased stock-type funds is 12.5%, an increase of 0.9 percentage points compared to the previous quarter. In terms of stock concentration, the proportion of market cap of the top 10/top 20 heavy-weight stocks in actively biased stock-type funds in the third quarter of 24 was 52.7%/61.8%, a decrease of 1.5/2.3 percentage points compared to the previous quarter, showing a decrease in position concentration.
From the perspective of major industries, in the third quarter of 24, funds mainly increased positions in Hong Kong stock consumer sector, while decreasing positions in energy and materials.
In the third quarter of 24, funds mainly increased positions in Hong Kong stock consumer sector, with a net increase rate of 5.3 percentage points after excluding price effects. As of the third quarter of 24, the consumer industry was over-allocated by 6.0 percentage points relative to the industry's free float market cap. Funds mainly reduced positions in the energy and materials sector, with a net decrease rate of 7.0 percentage points after excluding price effects. As of the third quarter of 24, the energy and materials industry was over-allocated by 6.8 percentage points relative to the industry's free float market cap.
From the perspective of segmented industries, in the third quarter of 24, funds mainly increased positions in Hong Kong stock commerce, retail, social services, and autos, while reducing positions in petroleum, utilities, and telecommunications.
In the third quarter of 24, funds mainly increased positions in Hong Kong stock commerce, retail, social services, and autos, with net increase rates of 4.0, 2.1, and 0.8 percentage points, respectively, after excluding price effects. Funds mainly reduced positions in the petroleum, utilities, and telecommunications sectors, with net decrease rates of 5.1, 1.5, and 0.3 percentage points, respectively, after excluding price effects.
From the perspective of conceptual sectors, in the third quarter of 24, funds mainly increased positions in Hong Kong stock internet, CRO, and biotechnology sectors, while decreasing positions in energy, high dividend, and durable consumer goods sectors.
In the third quarter of 24, funds mainly increased positions in the internet sector, focusing on increasing positions in Meituan-W (03690) and Tencent Holdings (00700); added positions in the biopharmaceuticals and medical services sub-sectors of the CRO sector; also increased positions in the biotechnology sector, including Akeso (09926) and Innovent Bio (01801). Funds reduced positions in the energy sector, mainly reducing holdings in oil & gas extraction; reduced holdings in CNOOC in the high dividend sector (00883); and also decreased positions in the durable consumer goods sector, mainly reducing holdings in entertainment supplies company Samsonite (01910) and others.
Risk warning: The Fed's interest rate cut was less than expected, domestic policy measures were less than expected, and domestic economic recovery was less than expected.
