经过这轮升势后，对比标普500指数和MSCI世界指数的来年Fang Zhuoyun believes that after a rapid rise in the mainland and Hong Kong stock markets, the recent adjustment is a short-term technical correction. Whether the upward trend of the Chinese stock market can continue will depend on the support intensity of fiscal stimulus policies, which is still the key to reversing the structural growth prospects of China.
According to the Wisdom Financial APP, Fang Zhuoyun, Chief Investment Officer of HSBC Global Private Banking and Wealth Management Asia, stated that the Chinese State Council announced that it will hold a press conference on October 12 to introduce measures to "increase the counter-cyclical adjustment strength of fiscal policy." The bank expects the Chinese government to further promote fiscal stimulus measures to complement loose monetary policy, thereby boosting domestic demand and supporting economic growth. The bank believes that after a rapid rise in the mainland and Hong Kong stock markets, the recent adjustment is a short-term technical correction. Whether the upward trend of the Chinese stock market can continue will depend on the support intensity of fiscal stimulus policies, which is still the key to reversing the structural growth prospects of China.
She pointed out that the basic scenario predicts a scale of new fiscal stimulus measures of 1 trillion yuan (RMB as below), with 500 billion yuan used for direct consumption stimulus and another 500 billion yuan for key projects in the "14th Five-Year Plan." The bank also expects the Chinese government to allocate an additional 1 trillion yuan to support the increased capital of banks, but the specific timetable for the implementation of fiscal stimulus measures by the Ministry of Finance is unclear.
After this round of upward trends, compared to the S&P 500 Index and MSCI World Index for the next year.Estimated P/E ratio.21.8 times and 19.6 times, the forecast PE ratios for the MSCI China Index, Hang Seng Index, and CSI 300 Index next year are 11.5 times, 9.8 times, and 14.4 times respectively, indicating significant undervaluation.
The bank favors high-quality high-yielding Chinese state-owned enterprises, as well as blue-chip technology and internet companies with stable profits and valuations far lower than their global peers like NetDragon. As for the Hong Kong market, the bank is bullish on undervalued high-yielding stocks within the insurance, telecom, and utilities sectors, as well as selectively oversold but financially strong real estate developers.
To reflect the favorable factors brought by the latest mainland capital market support measures, the bank has respectively raised the index targets for the SSE Composite Index, CSI 300 Index, and SZSE Component Index at the end of 2024 to 3800 points, 4700 points, and 12000 points. The bank expects China's long-term low-interest environment to continue, and the PBOC's loose policy will provide good support for Chinese investment grade bonds. The bank maintains a neutral view on Chinese local currency bonds and major currency bonds. The bank also maintains a neutral view on the USD against the RMB, forecasting it to be 7.2 by the end of 2024.
