After continuous surges, foreign capital is paying attention: Hong Kong stocks "the prices of a batch of stocks have risen by 30% to 40%, almost reaching historical highs"
Institutions such as Invesco and JPMorgan Chase are cautious, believing that market sentiment will eventually return to fundamentals, and whether more policy measures can be implemented in the future remains key. However, some optimistic individuals expect that considering the low valuation of Hong Kong stocks, the market rebound is not yet over
As Goldman Sachs "overweights" the Chinese stock market, expecting another 15-20% increase, market optimism has reached a peak. The Hang Seng China Enterprises Index has risen by over 30% in the past month, ranking first among more than 90 global indices tracked by Bloomberg.
However, this epic surge in the short term has sparked much discussion in the market, raising questions about the future "momentum".
Raymond Ma, Chief Investment Officer for Hong Kong and Mainland China at JPMorgan Asset Management, emphasizes the importance of fundamentals:
Market sentiment may be overextended in the short term, but people will eventually return to fundamentals. Due to this surge, some stocks are already overvalued.
He also added that there is no rush to increase positions at the moment:
Some Hong Kong stocks have risen by 30% to 40%, almost reaching historical highs... Whether the fundamentals in the next 12 months will be as good as before they peaked is more uncertain to me, and this may be the positions we might cut.
JPMorgan Asset Management also maintains a cautious stance, believing that the key lies in whether more policy measures can be introduced, as the market is waiting for new policy guidance to be solidified. Tai Hui, Chief Market Strategist for JPMorgan Asset Management in Asia Pacific, stated:
More policy steps are needed to boost economic activity and confidence. The policies announced so far can help smooth the deleveraging process, but balance sheet repair is still needed.
Tai Hui also believes that the uncertainty in the global economy will have an impact, such as the upcoming U.S. election just a month away.
However, considering that the valuation of the Chinese stock market is still low, many institutions are quite optimistic. Matthew Quaife, Head of Global Multi-Asset Investment Management at Fidelity International, said:
The market rebound is not over yet, and there is still a lot of money that needs to be rebalanced, especially from global investors. From a technical perspective, valuations are still below average, and the rebound may continue. Of course, the extent to which the rebound can translate into returns remains to be seen