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<Research>CICC: Now Hard to Make Definite Judgment on Systematic Revaluation of CN Asset System given AI Development; If HK Stock Mkt Excited, Make Moderate Profit
Recommend 107 Positive 125 Negative 82 |
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CICC released a Hong Kong stock strategy report. It opined that the abrupt emergence of DeepSeek not only ignited enthusiasm in the tech sector, but also boosted overall market sentiment. Investors were watchful of how much room there is left in the market, with signs of overdraft in the short term; if sentiment further recovers to the peak of early October 2024, it will correspond to around 23,000 on the HSI. Market sentiment is close to the peak of early May 2024, and technical indicators are close to overbought, while investors were divided about this. First, in terms of investor sentiment, the HSI risk premium has slumped rapidly from 7.8% in mid-January to 6.9%, which is very close to the level (6.7%) at the peak point of the rapid rebound in May 2024, but still a certain gap from the 6.0% at the peak point in early October 2024. During the market rebound in late September and early October 2024, CICC had reminded investors through the calculation of risk premiums that the HSI had clearly overdraft near 22,500 and suggested taking profits appropriately. The market did indeed correct near this level. Akin to the previous round, this round of market gains was also mainly attributable to the fall in risk premiums. Therefore, the broker assumed that the risk-free interest rate and earnings will remain at current levels. The broker said that the easing of pressure from US tariffs, the quantitative recovery of data during the Spring Festival, and the excitement brought about by DeepSeek in the industry may instead further reduce the possibility of additional domestic short-term policies. In contrast, the development prospects of the AI industry are more critical, and the importance of a systematic reappraisal of Chinese assets is self-evident, but for the time being it is still impossible to make a firm judgment. CICC's allocation advice is that although short-term market sentiment is overwhelmingly hot after the holiday and may further improve in the short run, the annual outlook remains intact, i.e., the overall market has not yet shaken off the pattern of volatility. The broker advised investors to step in more aggressively during a downturn, while making a taking profit during an upsurge. In the short term, if the risk premium falls to the trough of 6.7% in May 2024, which corresponds to around 21,600 on the HSI. If the risk premium falls to the bottom of 6% in early October 2024, the corresponding HSI point will be 23,000, but it is difficult to predict at the moment. In terms of allocation structure, the broker continued to recommend a combination of stable returns (dividends + repurchases, especially for growth companies with a high proportion of net cash) and growth. For example, investors may pay attention to technology sectors with their own industry trends and policy support directions, such as semiconductors, AI and robotics, etc. Sectors improving marginal demand with policy support, such as home appliances under the trade-in policy, automobiles, some consumer services on the Internet, home appliances, and textile services are also under limelight . Conversely, investors may keep eyes on possible short-term disruptions in some export industries. AAStocks Financial News |
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