Oriental Huili Private Bank Zhao Yingyan: Hong Kong stocks are in a healthy adjustment period, and capital rotation is expected to benefit high-interest stocks

The Zhitong Finance App learned that Hong Kong stocks continue to hover at the 25,000 level. Zhao Yingyan, a senior investment strategist at Oriental Huili Private Bank, said that Hong Kong stocks had risen by 2,000 to 3,000 points, and lacked a new catalyst after the performance period. In addition, the situation between the US and Iran is still holding back, and the market has adjusted normally. She believes that Hong Kong stocks are currently in a period of healthy adjustment, and the decline is not expected to be too deep. Afterwards, the market will keep an eye on the Sino-US talks in September.

Zhao Yingyan believes that the performance of Chinese technology stocks is generally in line with expectations. Although revenue is weak, there is not much difference in profit. Increased AI capital expenditure is putting pressure on profits and free cash flow. However, Chinese companies are more orderly in AI investment than the US, and can also purchase more domestic chips, which are more cost-effective. Coupled with relatively low sector valuations, this may increase the incentive for foreign investment to return to Chinese technology stocks.

She also mentioned that the DeepSeek price increase reflects that the Chinese AI model is more flexible in terms of price, and the profitability of science and technology companies is expected to increase. But even if AI is a growth engine for the next two to three years, its contribution to the enterprise is still limited.

Therefore, in terms of allocation, Zhao Yingyan anticipates that capital will rotate and will look again at high-interest stocks, and is optimistic about local integrated enterprises, REITS, and financial stocks in Hong Kong. Insurance stocks have recently been pressured by news that the Mainland is taxing the income of overseas insurance policies, but suggestions can be taken advantage of the low absorption. Since there is still a gap between the return on investment between the Mainland and Hong Kong, this is beneficial to Hong Kong.