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<Research>BOCOMI Urges Caution Against Adjustment Risks from Hedging Sentiment, Recommends High Div. Stocks as Defensive Base
Recommend 26 Positive 58 Negative 22 |
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With escalating global uncertainties, the Hong Kong stock market showed a volatile trend in March, BOCOMI opined in its report. After a strong rise in February, the upward momentum of Hong Kong stocks weakened in March, with the HSTECH entering a technical adjustment phase, yet it still led major global indices YTD. Earnings expectations remained relatively cautious as valuations of leading internet stocks had largely recovered. Meanwhile, southbound funds continued to show net inflows. With funds experiencing periodic divergence and the long-short game intensified, Hong Kong stocks have shifted from a unilateral rise to a volatile trend. In terms of industry style allocation, BOCOMI suggested focusing on "high flexibility + high dividends". In the tech innovation sector, the broker was upbeat about Hong Kong's AI and internet sectors (especially with the push from Chinese-made foundation models like DeepSeek) creating a valuation restructuring window for AI infrastructure providers, cloud computing service providers, and AI application-related targets. It recommended focusing on leading companies with technical accumulation and commercialization capabilities. In addition, the semiconductor industry chain also merits attention. Particularly, the accelerated localization process of the industrial chain has highlighted opportunities for mainland chip design companies with import substitution potential. The report also mentioned that adjustment risks triggered by hedging sentiment should not be ignored with recent overseas volatility remaining significant. BOCOMI suggested using high dividend sectors as a defensive base, while paying attention to sectors like power utilities, telecom operators, and banks, which have stable cash flows and attractive dividend yields. BOCOMI listed its stock picks for April, including LINK REIT (00823.HK), BABA-W (09988.HK), JD-SW (09618.HK), MENGNIU DAIRY (02319.HK), XPENG-W (09868.HK), SIMCERE PHARMA (02096.HK), REMEGEN (09995.HK), and JNCEC (00579.HK). AAStocks Financial News |
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