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2026-11-09 17:02:45 HSBC Global Investment Research published a research report stating that changes over the past two weeks in interest rate and foreign exchange outlooks, the US midterm elections, market views on AI capital expenditure, 3Q26 earnings and policy support for the China stock market have altered the risk-reward profile of Greater China financial stocks. HSBC Global Investment Research has therefore repositioned its portfolio, adjusted holdings and proposed four major actions. It expects market activity to rebound by the end of 4Q26, with momentum extending into early 2027. The broker maintained a positive view on Hong Kong financial stocks and upgraded HKEX (00388.HK) from Hold to Buy, while raising its TP from HKD410 to HKD450. The broker said HKEX (00388.HK) could benefit from a recovery in capital market activity and is not reliant on growth in the AI capital expenditure cycle. Since the end of August, the stock has underperformed the HSI Financials Index by about 5 ppts. It believes market expectations have reset to more achievable levels. Average daily turnover in October fell 10.5% MoM to HKD181 billion, but rebounded to HKD256 billion in the first week of November. Mainland China's securities regulator reportedly suspended new A-share IPOs, which may strengthen Hong Kong's role as a listing platform for Chinese-funded enterprises. HSBC Global Investment Research lowered its earnings forecasts for HKEX (00388.HK) for 2026 to 2028 by 1.5%, raised by 0.1% and raised by 1.1%, respectively. In addition, HSBC Global Investment Research raised the TP for AIA (01299.HK) from HKD78 to HKD83 and maintained a Hold rating. It believes 3Q26 may mark the trough of the new business value growth cycle. Stronger performance in Hong Kong and ASEAN is expected to partially offset weaker-than-expected new business value in mainland China. The broker raised its new business value growth forecasts for 2026 to 2028 to 10.2%, 11.4% and 11.5%, respectively. The broker maintained a positive view on Hong Kong local banks, believing deposit competition is a timing issue rather than a structural deterioration. It sees the recent pullback as a good opportunity to Accumulate BOC HONG KONG (02388.HK) and BANK OF E ASIA (00023.HK). It maintained a Buy rating and HKD58 TP for BOC HONG KONG (02388.HK). BANK OF E ASIA (00023.HK) was also rated Buy with a TP of HKD21.5. As for mainland Chinese banks, HSBC Global Investment Research turned more cautious in its outlook, while assigning Buy ratings to BANK OF CHINA (03988.HK), CCB (00939.HK) and CM BANK (03968.HK), with TPs raised to HKD7.1, HKD12.9 and HKD68, respectively. (gc/u)~ AASTOCKS Financial News Website: www.aastocks.com This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. | |