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Developers Subdued on Lower Rate Cut Expectations; NWD Tumbles 5%; MTR Hits 8-mth+ Low
Recommend 26 Positive 53 Negative 58 |
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Strong US employment data last month further cooled expectations for Fed rate cuts. Goldman Sachs analysts reduced their forecast for the Fed rate cuts this year from three to two. Another rate cut is expected next year to bring the terminal rate to 3.5-3.75%, from the current levels of 4.25-4.5%. BofA Securities also predicted the Fed may not cut rates again this year. Some brokers were pessimistic about this year's local property price trend. UBS lowered its forecast for residential price increases this year from the original 0-5% range to no change, reflecting the potentially less rate cuts after the US election. The interest rate-sensitive Hong Kong developers and landlords were subdued. NEW WORLD DEV (00017.HK), with its leverage level closely watched by the market, opened 0.7% lower today (13th). Poised for an eleven-day losing streak, it once reached a historical low of $4.21 with a slump of 5.2% after midday. It last printed at $4.22, down 4.95%, on a turnover of $47.9409 million. Goldman Sachs reduced its target price for the company from $5.8 to $5.1 and kept the Sell rating unchanged. Peers of Hong Kong developers were also softened. CK ASSET (01113.HK) and KERRY PPT (00683.HK) waned 1-1.5%. SHK PPT (00016.HK) lost 2%. HENDERSON LAND (00012.HK) dipped 2.9%. In addition, MTR CORPORATION (00066.HK) hit an over eight-month low. It last printed at $24.1, down 4.37%, on a turnover of $1.94 billion. HSBC Global Research downgraded the company's rating from Buy to Hold and chopped its target price to $27, believing that even with continuous improvement in recurring business, the risk of a rising capital expenditure cycle may drag on profitability, and it lacks short-term catalysts despite its defensive nature. LINK REIT (00823.HK) reached a six-month low. It was last at $31.25, down 2.65%, on a turnover of $2.4 billion. WHARF REIC (01997.HK) sank to an over five-month low. It was last at $18.36, down 1.71%, on a turnover of $18.6529 million. HANG LUNG PPT (00101.HK) slipped to an over three-month low. It was last at $5.9, down 1.83%, on a turnover of $22.781 million. AAStocks Financial News |
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