Hong Kong utility stocks demonstrated defensive characteristics, rising against the market trend today. As of the latest update, Hong Kong and China Gas Company (00003.HK) increased by 1.72%, trading at HKD 7.69; Power Assets Holdings (00006.HK) rose by 0.96%, trading at HKD 63.4.
According to Zhitong Finance, Hong Kong utility stocks demonstrated defensive characteristics and rose against the market trend today. As of press time, Hong Kong and China Gas Company (00003.HK) increased by 1.72%, trading at HKD 7.69; Power Assets Holdings (00006.HK) rose by 0.96%, trading at HKD 63.4; HK Electric Investments (02638.HK) climbed by 0.72%, trading at HKD 7.01; CLP Holdings (00002.HK) increased by 0.61%, trading at HKD 74.6; and Cheung Kong Infrastructure Holdings (01038.HK) also rose by 0.61%, trading at HKD 66.15.
In terms of market news, a research report by HSBC Global highlights that empirical analysis shows the Hong Kong utilities sector has consistently exhibited its defensive attributes during significant global conflicts. The sector has outperformed the broader market in the aftermath of relevant events, surpassing the Hang Seng Index by 7% within 60 days after major incidents. Beyond typical risk aversion sentiment, the firm believes the core fundamentals of the sector remain solid, protected by regulatory frameworks and long-term contracts, enabling it to withstand macroeconomic uncertainties and disruptions. Additionally, with Iran closing the Strait of Hormuz, fuel prices have surged. However, the bank anticipates minimal impact on the sector's earnings because for regulated utilities in Hong Kong, the UK, and Australia, fuel costs can be fully passed on to consumer bills.
