Changes in Hong Kong stocks | Some Hong Kong bank stocks declined, Goldman Sachs lowered the Bank of Hong Kong stock earnings estimates, says it is more difficult to undergo a major valuation revaluation

The Zhitong Finance App learned that some Hong Kong bank stocks were lower. As of press release, Bank of East Asia (00023) fell 4.64% to HK$10.28; Dah Sing Bank Group (02356) fell 3.32% to HK$7.58; and BOCHK (02388) fell 2.34% to HK$29.2.

According to a research report published by Goldman Sachs, the earnings estimates per share for each year from 2025 to 2027 will be lowered by 14%, 19%, and 15%, respectively, by an average of 16%, and the target price will be reduced by an average of 9%. Goldman Sachs said that it is currently expected that the Federal Reserve will cut interest rates 5 times this year. The decline in net interest spreads and the increase in credit costs will add downside risks to local banks in Hong Kong. It is expected that in the face of weak growth in the loan business and a decline in profitability, it will be more difficult to carry out a major valuation revaluation.

According to a research report published by J.P. Morgan Chase, the stock prices of HSBC Holdings and Standard Chartered Group have been adjusted by 16.6% and 20.4% respectively since April 2, outperforming the Hang Seng Index by 2.1 and 5.9 percentage points, respectively. The bank believes that the market is betting that the world is falling into recession, which may lead to deeper interest rate cuts, reduced revenue for transactional banks, and higher credit costs. J.P. Morgan believes that in the face of a recession in the US and the global economy, central banks such as Foreign Exchange Control and Standard Chartered will be more vulnerable than the Bank of Hong Kong and the Bank of China, so I believe these two banks will outperform the market in the short term.