HK Stock Market Move | Internal bank stocks continue to rise recently, with Postal Savings Bank Of China (01658) up more than 3%. Morgan Stanley said that multiple catalysts continue to support the revaluation of banks.

Domestic banking stocks continued their recent rise. As of the time of writing, Postal Savings Bank Of China (01658) was up 3.3% to HK$5.63; Agricultural Bank Of China (01288) was up 2.05% to HK$5.97; Industrial and Commercial Bank of China (01398) was up 1.34% to HK$6.04; Bank Of China (03988) was up 1.15% to HK$4.41. On the news front, the latest research report from Morgan Stanley stated that domestic banking stocks are expected to hit bottom in the third quarter. This is the first time that the Chinese financial system has achieved a "natural cyclical bottom" without massive stimulus policies M1 growth rebounded and industrial enterprise profits improved without major stimuli. The bank pointed out that upcoming dividend payouts in the fourth quarter, stabilized interest rates, support from 500 billion RMB structural financial policy tools, and a more sustainable policy path will all support a reevaluation of banking stocks. EB SECURITIES pointed out that the operational performance of banks is resilient, with listed banks set to release their third quarter reports. It is estimated that revenue growth for Q1-Q3 will be relatively stable quarter-on-quarter, with slight improvement in profit growth quarter-on-quarter, providing a stable foundation for full-year performance. After a period of adjustment since Q3 2019, the banking sector's "high dividend, low valuation" attributes are once again highlighted, especially in the comparison of AH-synchronous listed banks, where the valuation advantage of Hong Kong-listed banks is more pronounced. The escalating tensions in the US-China trade war have raised risk-averse sentiment, increasing the attractiveness of the defensive properties of the banking sector to investors. Meanwhile, insurance, AMC, industrial capital, and other funds still have a continuous demand for allocation in banking stocks.