View news and market trends on East Money, choose East Money Securities for one-stop account opening and trading. On November 28th, Liu Gang, Chief Analyst of Hong Kong and Overseas Strategy at CICC, stated at the ‘CICC Market Strategy Outlook’ that the Hong Kong stock market is currently in a phase described as ‘thick clouds without rain’. He further explained that this term, originating from the I Ching, is mainly used to describe the current high market expectations for the Hong Kong stock market, which requires a ‘catalyst’.
Liu Gang believes that CICC considers the Hong Kong stock market to be in a pattern of wide fluctuations, and under this situation, the market also has some advantages. He indicated that the advantages appearing in the Hong Kong stock market mainly come from two aspects: firstly, the long-term capital allocation ratio in the Hong Kong stock market has been significantly low, and foreign long-term capital will strengthen its allocation to Hong Kong stocks at the current position; secondly, the market valuation for Hong Kong stocks is relatively sufficient. Liu Gang believes that due to the ample capital positions, the Hong Kong stock market could quickly rebound in 2024 if a ‘catalyst’ emerges. For example, the ‘trade-in’ policy has shifted consumer habits from online to offline, and some policies related to tech hardware have driven the performance of Hong Kong stocks in 2024. In April 2024, seven departments including the Ministry of Commerce jointly issued the ‘Implementation Rules for the Auto Trade-in Subsidy’. The rules state that individual consumers who scrap fuel passenger cars with emission standards of National III or lower or new energy passenger cars registered before April 30, 2018, and purchase eligible new cars within a certain time frame, will enjoy a one-time fixed subsidy. In the second half of 2024, detailed rules for passenger car ‘trade-in’ subsidies (replacement updates) have also been released in various provinces and cities, with subsidies for individual cars concentrated around 15,000 yuan. On this basis, Liu Gang stated that CICC has not given up on high-dividend assets. Previously, CICC advised investors to maintain a ‘barbell configuration’, mainly because, under the current fluctuating structure, there are some expected fluctuations in the Hong Kong stock market. In addition, he suggested that investors could increase the allocation of dividend-returning assets in the near term to enhance the robustness of the overall investment portfolio. It can serve as a stable asset in the portfolio to enhance the robustness of the overall portfolio. Liu Gang said that CICC, based on the supply-side structural reforms from 2015 to 2017, has selected the stages of clearing in various sectors from financial indicators and is optimistic about some internet stocks, consumer stocks, and some home appliance and automotive stocks that benefit from the ‘trade-in’ policy.
