Latest Search
Quote
| Back Zoom + Zoom - | ||||
|
Ping An Securities: US Stagflation Risks Rise; HK Stock Mkt 'Main Battlefield' for CN Tech Asset Revaluation
Recommend 49 Positive 90 Negative 42 |
||||
|
||||
|
Ping An Securities released a strategy report. It said that on the overseas asset front, waning U.S. economic data over the past two weeks has heightened recession concerns, driving a decline in U.S. stocks and a drop in U.S. Treasury note yield rates. Also, the US dollar faced additional pressure from Germany’s fiscal expansion plans, depreciating further, while gold prices fluctuated at elevated levels. In contrast, Hong Kong’s equity market saw a boost in sentiment, fueled by a sustained tech rally and the conclusion of China’s Two Sessions, which signaled more proactive and aggressive policy measures to come. The revaluation of Chinese assets appears to be spreading to cyclical sectors. Last week, beyond dramatic gains in IT and consumer discretionary sectors, galvanized by tech revaluation, Two Sessions expanding domestic demand and new productive force policy, cyclical industries such as raw materials and real estate construction also posted gains. On the capital flow front, southbound fund inflows narrowed compared to the previous week but remained substantial in absolute terms. Foreign investment continued to rise, with the proportion of shares held by international brokers increasing, indicating ongoing inflows. Beyond IT and consumer discretionary sectors, foreign capital has increased allocations to financials and real estate construction, suggesting the revaluation of Chinese assets is extending to cyclical sectors. In its asset allocation guidance, Ping An Securities cautioned that the escalating risk of U.S. stagflation warrants vigilance against price volatility in USD-denominated assets. In the short run, pressure on U.S. stocks to correct is mounting, while the downside for U.S. Treasury note yield rates appears limited, potentially leading to a flatter yield curve. The USD Index was also expected to weaken amid softening economic expectations. However, uncertainties persist due to Trump administration policies, such as the potential delay of government layoffs if a recession emerges, or inconsistent enforcement of tariff measures. The broker believed Hong Kong stocks remain in a favorable strategic allocation window, particularly highlighting the mid- to long-term investment value of tech assets in the Hong Kong stock market. Opportunities in subsectors like AI and consumer electronics are worth monitoring, while the broker also recommended focusing on structural opportunities in high-quality domestic consumption assets supported by policy initiatives. Ping An Securities accentuated that leading companies are poised to continue driving the rally in Chinese tech stocks. The Hong Kong stock market, home to some of China’s top tech growth firms, remains the “main battlefield” for the revaluation of Chinese tech assets. The IT sector in Hong Kong boasts a P/E ratio at a relatively low historical percentile of 42.0%, while most of the top ten tech giants (Terrific 10) still have room for valuation repair, with signs of improving earnings expectations. Notably, BABA-W (09988.HK) charted 4Q24 results that beat expectations, with both revenue and profit from its AI and Alibaba Cloud businesses rising, with capex upsurge in cloud and AI, laying a stronger foundation for future revenue and profit growth. AAStocks Financial News |
||||
Copied to Clipboard
 |
||||
