What do you think of the recent pullback in Hong Kong stocks?Institutions have sung more about these sectors in the market outlook, and these sectors are optimistic about the provider Zhitong Finance

What do you think of the recent pullback in Hong Kong stocks?Institutions have sung the market outlook and these sectors are optimistic

Zhitong Finance APP learned that Hong Kong stocks have recently undergone significant adjustments due to the combined influence of internal and external factors. On February 8, Hong Kong stocks continued their downward trend. According to statistics, the Hang Seng Index fell by 4.5% last week.Most of the sectors that previously benefited from the expectation of domestic economic recovery experienced a significant correctionAmong them, the insurance and real estate sectors performed poorly, falling 9.0% and 7.8% respectively, while the information technology and telecommunications sectors performed relatively stable, falling only 0.1% and 0.3%. From the perspective of funds, the southbound funds have experienced the fifth largest weekly outflow in history; from the perspective of the external environment, following the release of strong US non-agricultural data, the US dollar and US bond interest rates have also risen once more.

In this regard, Guotai Junan issued a research report stating that Hong Kong stocks have undergone significant adjustments recently following experiencing a “good start”. The reason for the callback is not only the profit-taking sentiment following the expected fulfillment, but also the negative impact of some recent events on the market’s risk appetite. However, the bank believes thatThe trend of domestic economic recovery continues, which will lead to a significant upward revision in the profits of Hong Kong stock companies. At the same time, overseas liquidity recovery transactions are still in progress, and the index valuation is expected to recover to the level at the beginning of 2022.The catalyst is the release of domestic social financing and the policy shift of the overseas Federal Reserve, which may be around the second quarter.

Regarding the market outlook, Li Zhiwu, manager of Chuangjin Hexin Hong Kong Stock Connect Growth Fund, believes that in the medium and long term, there are several directions for Hong Kong stocks that deserve special attention.the first isBiomedical companies represented by innovative drugs.the second isA direction compatible with the national transformation and upgrading strategy, will be subdivided into many industries, such as Xinchuang, industrial Internet, big data, artificial intelligence, etc.the third isInvestment opportunities represented by national security, such as areas related to energy security, information security, and necessary strategic material security. Li Zhiwu said that these are the industries, sectors, and technology directions that my country needs to make up for in a relatively long period of time in the future.

CICC believes that the current market consolidation is more of a pause in the rebound process than a trend reversal.Although there may be profit-taking fluctuations in the rebound process, he believes that the Hong Kong stock market still has room to rise.

According to CICC’s judgment, the rebound rhythm of the market is similar to “three steps”, and it is currently in the second step: the first step is the improvement of risk appetite, and the rebound has basically been completed since November; the second step is the decline in US bond interest rates to promote valuation The value is further repaired (currently in progress); the third step is that following the second quarter of this year, corporate earnings may drive the market to rebound (specifically, it will depend on the strength of policy support to stimulate consumption and the real estate industry). In terms of allocation strategy, in addition to consumption and real estate that benefit from favorable policies, investors are advised to pay attention to three directions: the Internet and healthcare, which are expected to reverse and repair, and high-tech software and hardware.

Guosen Securities pointed out in the research report that following three consecutive months of upward movement in Hong Kong stocks, the short-term has entered the adjustment stage, and it is currently showing a pattern of switching from high to low. Although the overall growth rate of the Internet is relatively high, because their quarterly reports and first quarter reports are all positive, they are more certain than other industries, and the stock price has not yet returned to the position before the Russia-Ukraine conflict, so they can still be held firmly.

In addition, Guosen Securities believes that future investment opportunities in Hong Kong stocks exist in several aspects:

1、Judging from the rebound: Midstream industries such as computers, real estate, building materials, steel, electronics, automobiles, household appliances, beauty care, machinery and equipment have not yet surpassed the index, and these sectors have a higher probability of supplementary growth;

2、From the perspective of valuationthe valuation of cyclical upstream (coal, petroleum and petrochemical, non-ferrous metals) is higher; the valuation of building materials, steel, real estate, and banks in the real estate chain is lower; the electronics, computers, home appliances, and automobiles manufactured in the midstream are lower;

3、In terms of dividend rate and dividendsa large number of companies with high dividends in Hong Kong stocks, this indicator can be analyzed in combination with the rebound rate and valuation;

4. Since 2022, directors and non-directors of the company have increased their shareholding in the company, and companies have also repurchased their shares, listing the inverted companies (the current stock price is lower than the increase or repurchase price) for the convenience of investors Look for opportunities.