How to invest after the Hong Kong stock market hits bottom? Pay attention to technology stocks during the oversold rebound!

During the just-concluded month of August, despite the volatility and decline in the Hong Kong stock market, it received a boost from policy measures in the last two weeks, leading to a rebound. Moreover, sectors such as automobiles and semiconductors, which experienced significant declines earlier, also saw a strong rebound.

According to Dai Qing, an analyst at Guotai Junan, some macroeconomic indicators have already shown that the Hong Kong stock market is at a bottom position, and there has been marginal improvement in microeconomic data. Future macroeconomic expectations may also improve.

So, how should one invest in the Hong Kong stock market at this time?

One investment strategy is to anticipate an upward adjustment process due to the expectation of domestic policy heating up and the nearing end of the US Federal Reserve's interest rate hike cycle. There may be a window of opportunity for the Hong Kong stock market to rise. It is recommended to switch investment styles during a larger range-bound market and focus on sectors such as the Hang Seng Tech Index and internet retail, as well as the valuation advantages of the real estate chain in the Hong Kong stock market.

In addition, after weak recovery expectations have been largely priced in, it is advisable to allocate more to stable high-dividend stocks that are favored by the bank in the long term, such as communication operators and petrochemicals, in order to adapt to the characteristics of the times. At the same time, it is important to examine Hong Kong stock investment opportunities from a global perspective and focus on varieties that resonate with the global economic cycle and have improved liquidity, such as copper, gold, semiconductors, consumer electronics, and innovative pharmaceuticals.

During the period of oversold rebound, why should we pay attention to technology stocks?

In the third quarter, if there is an expectation of policy heating up in China and marginal easing of overseas liquidity, growth-oriented styles represented by the Hang Seng Tech Index may have a greater advantage.

What are the advantages of the "mid-to-high dividend" strategy in the Hong Kong stock market?

Hong Kong stocks of state-owned enterprises have the advantages of diverse targets (including many traditional industries), being relatively cheaper than A-shares (with a higher proportion of state-owned enterprises with a PB ratio of less than 1), and higher dividends (considering dividend taxes, they are also attractive). This means that the market trend will be more sustainable and have greater potential.

Looking at a longer time frame and relying on its offensive and defensive capabilities while adapting to the characteristics of the times, Dai Qing believes that "mid-to-high dividend" stocks may become the new "core assets" of the Hong Kong stock market.