Hong Kong Stock Market News! Hong Kong Chief Executive Carrie Lam to deliver her third policy address during her term

Hong Kong's heavyweight policies are about to be announced.

Carrie Lam, the Chief Executive of the Hong Kong Special Administrative Region, will deliver the 2024 Policy Address at 11:00 am on October 16 (Wednesday), attracting high attention from all sectors of society. It is rumored that Carrie Lam will announce multiple measures to consolidate Hong Kong's position as a global financial center in the Policy Address.

Prior to the release of the 2024 Policy Address, the Hong Kong stock market experienced a rapid surge, drawing widespread attention from global investors. For example, the Hang Seng Index rose by over 34% from September 11 to October 7, but subsequently experienced a correction, with the Hang Seng Index falling by over 6% this week.

The current focus of investors is whether the recent pullback in the Hong Kong stock market is a "passing of the baton" or a trend reversal.

Heavyweight Policies to be Announced

Carrie Lam, the Chief Executive of the Hong Kong Special Administrative Region, will deliver the 2024 Policy Address at 11:00 am on October 16, attracting high attention from all sectors of society.

Market expectations are that the upcoming Policy Address may introduce a series of new measures to revitalize the Hong Kong economy.

According to Ming Pao, this year's Policy Address will focus on economic development. In July, the 20th Central Committee of the Communist Party of China decided to consolidate and enhance Hong Kong's status as an international financial, shipping, and trading center, and support Hong Kong in building an international hub for high-end talent aggregation. It is revealed that the Policy Address will respond to the decisions of the Third Plenum, with a focus on how to consolidate and enhance the "three centers".

The Policy Address is Hong Kong's most important policy guideline and has been released every October since 1997.

According to the Violet Flower WeChat account, Carrie Lam's third Policy Address during her tenure will be announced next Wednesday (the 16th), with expectations from all sectors for more measures to support Hong Kong's integration into the national development plan.

The South China Morning Post cited sources saying that Carrie Lam will announce multiple measures to consolidate Hong Kong's position as a global financial center in the 2024 Policy Address next week.

The report mentioned that Carrie Lam will outline measures to achieve economic diversification in Hong Kong, by developing emerging industries such as life sciences, while promoting the development of existing industries such as the fashion trade.

Recently, Carrie Lam stated that the SAR government will continue to optimize various connectivity measures to promote the integration of the Greater Bay Area financial markets, serve the national strategy of building a financial powerhouse, and achieve high-quality development.

Lin Kin Fung, a member of the Executive Council of the Hong Kong SAR, expressed that everyone hopes for new policies to stimulate the Hong Kong economy and attract more foreign companies to establish roots in Hong Kong. He mentioned that the recent surge in the local stock market benefited from national economic policies, with stock trading volume reaching a record high of HKD 600 billion, creating a positive investment atmosphere for Hong Kong residents.

Lin Kin Fung believes that it is more important to have practical measures to help Hong Kong enterprises continue to develop. In recent years, senior government officials have frequently attracted foreign investment and conducted inspections abroad, and results will be seen gradually.

Lin Jianfeng further stated that the property market is an important part of the Hong Kong economy and cannot remain stagnant. After the cancellation of the "cooling measures" in the property market, the trading activity in the market has increased. However, property prices are still at a relatively low level, dropping by about 30% from their peak. Stabilizing property prices is of utmost importance.

According to Hong Kong Wen Wei Po, Hong Kong financial legislator Chan Chun-ying stated that Hong Kong can further assist in attracting more overseas financial institutions to establish a presence in the city and attract more financial talents to work in Hong Kong.

Chan Chun-ying mentioned that competition is fierce globally, with various places using unique strategies to attract businesses. In the case of Hong Kong, more than 70 of the world's top 100 banks are currently operating in the city, and many overseas financial institutions are interested in entering the Hong Kong market. According to current regulatory requirements, these financial institutions must first establish a representative office in Hong Kong before being able to upgrade to a branch after a certain period. These financial institutions' parent companies have a long operating history and performance support in their localities. It is suggested to expedite the approval process and time to facilitate more financial institutions to expand their business in Hong Kong.

Hong Kong legislator Chan Pui-leung stated that Hong Kong ranks third globally in the latest "Global Financial Centers Index," with an active and mature insurance market. The Special Administrative Region government should continue to actively promote the transformation and upgrading of the financial and insurance industry. It is recommended to provide tax incentives or stimulus measures to attract state-owned or overseas insurance companies to establish regional headquarters and exclusive captive insurance companies in Hong Kong, promoting Hong Kong to become an international captive insurance center and reinsurance hub.

How will the Hong Kong stock market perform in the future

Before the release of the 2024 Policy Address, the Hong Kong stock market experienced a rapid surge, attracting widespread attention from global investors.

Taking the Hang Seng Index as an example, from September 11th to October 7th, the index rose by over 34%. However, a correction followed, with a cumulative decline of 6.53% this week, currently standing at 21,251.98 points, narrowing the year-to-date gain to 24.66%.

Analysis institutions point out that after a strong rally, the Hong Kong stock market may face higher volatility and differentiation.

CITIC Securities stated that after a short period of rapid growth, the Hong Kong stock market naturally experiences some downward pressure, which is a self-regulating mechanism of the market. Furthermore, foreign capital may have taken profits after actively buying during the holiday period, adding pressure to the market. In addition, there may be certain expectations for the news conference held on the first day after the holiday, but the final results may not fully meet market expectations, causing investors to worry about the certainty of policies, thereby affecting market sentiment.

Looking ahead, CITIC Securities believes that despite a brief correction, the positive factors previously discussed continue to influence the Hong Kong stock market. In addition, the rebound of Hong Kong stocks is far from historical highs, with significant room for further growth. From a valuation perspective, taking the Hang Seng Index as an example, although valuation levels have been somewhat restored, they are currently only back to near the reasonable range, and it is premature to talk about a peak, indicating potential for further upside Guotai Junan Securities pointed out that the valuation cost-effectiveness of Hong Kong stocks, the Fed rate cut, strong interim report performance of Hong Kong stocks, and the efforts of domestic macro policies have jointly supported the previous rise of Hong Kong stocks. Looking ahead, if positive factors at home and abroad continue to be confirmed, they may support the continued rise of Hong Kong stocks.

Author: Zhou Le, Source: Securities China, Original Title: "Hong Kong Stocks Heavyweight! Li Jia Chao, to be announced soon!"