CICC published a research report stating that as of yesterday (30th), the Hong Kong based banks and the Hang Seng Index covered by the firm have recorded increases of 31% and 18% respectively this year, with Hong Kong banks outperforming the market for the fourth consecutive year. CICC believes that compared to interest rate trends, macroeconomic expectations and the banks' own performances are the main factors influencing stock prices, therefore, investing in Hong Kong banks should not be based on the stereotype of 'interest rate hikes being bullish for banks and rate cuts being bearish for banks.'

The firm stated that banks are a pro-cyclical industry, thus during the interest rate cut cycle driven by improved macroeconomic expectations, the stock prices of Hong Kong banks often outperform, with significant performance differentiation among different banks in this cycle. The distribution of international banks is more diverse, and the growth prospects of businesses in emerging markets are better, leading to better stock price performance compared to local banks.

Looking ahead to next year, CICC believes that the performance of Hong Kong banks is expected to remain stable, with shareholder ROI continuing at a high level, and revenues and net profits are expected to decline by 1.1% and 2.3% respectively next year. However, CICC believes that the market still needs some time to price in the 'soft landing with shallow rate cuts' cycle, currently maintaining the view that international banks outperform local banks, with Standard Chartered (02888.HK) as the first choice, being bullish on its steadily improving average tangible equity return (RoTE), assigning an 'outperform industry' rating with a target price of 115.6 HKD.