playtoearncryptogamespc| China Construction Bank (00939) led the gains by 4.14%: domestic banking stocks rose across the board, valuations were at a moderately low level, and solid credit growth drove the allocation value of the banking sector.
editor 2024-05-16 11:46:05 Nature 25
News summary
Domestic banking stocks rose across the board in early tradingplaytoearncryptogamespc, China Construction Bank (00939) led the gains by 4playtoearncryptogamespc.14% to HK$5.79. With the improvement in the quality and effectiveness of monetary policy and moderate bank valuations, Galaxy Securities is optimistic about its allocation value. If the Hong Kong Stock Connect dividend tax exemption is implemented, CICC expects H-share banking stocks to become the main beneficiaries.
Newsletter text
[Banking stocks are collectively red, and the market sentiment is optimistic] Domestic banking stocks generally showed an upward trend this morning. Among them, China Construction Bank (00939) led the increase at HK$5.79, an increase of 4.14%. Closely followed by China Merchants Bank (03968), which closed at HK$38.45, an increase of 3.64%. At the same time, Industrial and Commercial Bank of China (01398) and Postal Savings Bank (01658) increased by 3.13% and 2.96%, respectively, to HK$4.61 and HK$4.52 respectively. China Galaxy Securities pointed out in a research report released today that credit growth continues to maintain a steady trend, the pace of investment is balanced, and structural optimization has become prominent features. The research report emphasized that monetary policy will pay more attention to quality and efficiency, the monetary policy toolbox will continue to be enriched, and supervision will increase efforts to control idle funds. Although this has an impact on banks 'balance sheet expansion in the short term, it provides space for business structure optimization and business model transformation. Galaxy Securities analysis believes that the current valuation of banking stocks is at a mid-to-low level since 2020, but the dividend yield is showing an upward trend, so it continues to be optimistic about the allocation value of the banking sector. CICC agreed with this and believed that if the dividend tax exemption for Hong Kong Stock Connect is implemented, it is expected to further stimulate mainland investors 'enthusiasm for investing in the Hong Kong stock market, especially the high-dividend sector. This will have a short-term boost to market sentiment and improve liquidity in the Hong Kong stock market. CLSA also believes that if the recommendation is implemented, it will help narrow the dividend yield gap between A shares and H shares. H-share banking stocks will become the main beneficiaries, especially state-owned banks with higher dividend yields, which will gain greater favor.