China Securities Co., Ltd.: Now is the opportune time to layout the Hong Kong stock market with great value for money. The technology internet sector is the most recommendable.

China Securities Co., Ltd. released a research report stating that with the recent downturn in Hong Kong stocks and the divergence in trends between Hong Kong and A-shares, the valuation of Hong Kong stocks and the AH premium once again show high cost performance. Currently, Trump's victory has had an impact on the trend of Hong Kong stocks, but in the medium term, Trump's policy proposals are favorable for the liquidity of Hong Kong stocks. Therefore, after the short-term impact ends, Hong Kong stocks may experience an uptrend, and now is a very cost-effective time to invest in Hong Kong stocks, with the technology and internet sectors being the most recommended. Is the current Hong Kong stock pullback sufficient? Hong Kong stocks began to pull back on October 8, with the trend during the pullback period clearly diverging from A-shares, and the AH premium reaching a high level again. This is mainly due to the dominance of institutional investors in Hong Kong stocks, low acceptance of thematic investment, and the more significant impact of Trump's short-term trade on Hong Kong stocks. The Hang Seng Index has already fallen by more than two-thirds of its previous gains. Considering the relatively balanced background of positive and negative factors at this stage, we believe that the current pullback in Hong Kong stocks is relatively sufficient. Where is the current position of the long-term cycle of Hong Kong stocks? The recovery of earnings growth in Hong Kong stocks shows a leading advantage over the domestic fundamentals, with the information technology sector and non-essential consumer industries performing well. In terms of valuation, after the recent pullback, the PE and PB ten-year percentile of Hong Kong stocks have fallen to 21.2% and 21.1% respectively, while AH premiums have risen, and the dividend yield safety margin remains high. How do you view the future trend of Hong Kong stocks under the backdrop of Trump taking office? Trump's tax reduction proposals and inclination to pressure the Federal Reserve to cut interest rates are both favorable for the overall liquidity overseas. As Trump tends to prioritize implementing domestic economic policies, after the recent short-term impact ends, liquidity is expected to flow back into Hong Kong stocks, making it a very cost-effective time to invest in Hong Kong stocks. Among the various sectors of Hong Kong stocks, the technology and internet sector in Hong Kong has shown significant profit recovery, benefited from the trend of dividend repurchases, and favored by foreign investors in terms of liquidity, making it the most worth paying attention to.