JPMorgan published a Research Report indicating that the recent strong tone released by the Central Political Bureau supporting macroeconomic growth and the stock market is expected to have a positive response on China's financial stocks. It is believed that the performance of Brokerage stocks in the short term will outperform China Mainland Banking stocks, with a more bullish outlook on China Galaxy (06881).

The bank continues to indicate that among the China Mainland Banking stocks, CM BANK (03968) is preferred, believing it can benefit from improvements in Retail Trade and investment sentiment. At the same time, Ping An Bank is also viewed positively, estimating that under lower baselines and increased policy support, its Retail Trade will turn profitable by 2025. Additionally, state-owned China Mainland Banking may underperform growth-oriented banks due to dilution risks, risks associated with serving national strategies, and limited space for profit growth.

The institution anticipates that the stock market will be volatile in the first quarter of next year due to trade tensions, but expectations for further policy support from China should help limit the downside risks for China's financial stocks.