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<Research>M Stanley: Policy Shift Earlier Than Expected, Supporting Rebound of CN Financials
Recommend 49 Positive 112 Negative 53 |
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Morgan Stanley commented in a report that while investors remain divided, there are now more signs that the shift in policy focus by the mainland authorities is bearing fruit sooner than expected. These include the easing of risks in the financial system and healthy export growth despite unfavourable factors, which are expected to continue to support a rebound in the performance of Chinese financials. While the market is concerned about the negative PPI, the priority policy of controlling financial risks and promoting industrial upgrading is bearing fruit, according to Morgan Stanley. The broker considered it not easy to eliminate the risks that have built up over the years, including real estate and LGFV risks, but believed that the current policy direction would help ease the downward pressure on the economy by tolerating some of the negative PPI. It is not very friendly to the capital market in the short term, but it is favourable for long-term development. The broker forecasted that the short-term pressure from risk control will last for more than 12 months, while long-term risk reduction, gradual stabilisation of the property market, and continued healthy growth in household incomes and financial assets due to industrial upgrading will lower credit costs and support insurance sales, providing support for bank and insurance stocks. AAStocks Financial News |
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