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Hong Kong market is undervalued, according to strategists

Hong Kong’s market is currently undervalued, but conservative investors may want to stay on the sidelines for now before stepping in, said Kenny Wen of Everbright Sun Hung Kai.

The company’s wealth management strategist, Wen, told CNBC’s “road signs” that “if relatively conservative, especially if you already own a 40% or 50% stake, take a wait-and-see approach. I think we can do it. ” Wednesday Asia “.

He said a market driven by emotions surrounding issues such as debt-stricken developers China Evergrande, “Still very uncertain”.

“We agree that the Hong Kong market is undervalued, so we can start building our portfolio,” Wen told “relatively aggressive” investors.

Benchmark at the end of Wednesday Hang Seng Index In Hong Kong, it was about 23% lower than the February high. In the third quarter alone, the index fell by nearly 15% during this period.

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Hong Kong’s investment outlook is “extremely uncertain,” according to Wen, with stock markets, especially institutional investors, tightening policies on China’s high-tech equities and uncertainties surrounding debt-bearing real estate giant Evergrande. It is necessary to digest various factors such as.

For those looking to buy “volatile” stocks, such as in the new economy sector, strategists warned that US Treasury yields are rising and could put pressure on the tech sector. Some examples of new economy stocks include technology stocks, but stocks in sectors such as utilities are usually classified as old economy stocks.

“I think the tech sector remains pretty volatile,” Wen said, warning investors that he was “too aggressive” with tech stocks in the coming weeks or months.

Benchmark 10-year Treasury yields have recently exceeded 1.5% and have been around that level ever since. High bond yields can hurt tech stocks. As interest rates rise, the value of the company’s future cash flow declines and stocks appear to be overvalued.

Rising bond yields in the U.S. Federal Reserve prepare Reduce bond purchases in the coming months, Usually a precursor to future rate hikes.

Hong Kong market is undervalued, according to strategists

Source link Hong Kong market is undervalued, according to strategists

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