JP Morgan: HKEX (00388) performance better than expected, with a solid fundamental trend.

JPMorgan released a research report stating that despite strong trading volume, the share price of HKEX (00388) has fallen over the past few months along with the Hang Seng Index. JPMorgan believes that this divergence between stock price performance and fundamental driving factors (trading volume) will create conditions for a strong price increase in the coming months, maintaining a "overweight" rating with a target price of 530 Hong Kong dollars. HKEX's net profit for the third quarter was 4.9 billion Hong Kong dollars, a 56% increase year-on-year and a 10% increase for the quarter, which was 3% higher than the bank's estimate. The performance of various businesses exceeded expectations, with revenue 1% higher than JPMorgan's forecast, mainly driven by clearing and settlement income; expenses were 4% lower than forecast due to a decrease in staff costs. Investment net income decreased by 34% for the quarter, which was roughly in line with expectations. Operating profit margin reached 75%, an increase of 203 basis points for the quarter, surpassing expectations. During the quarter, the average daily turnover of the securities market increased by 20% for the quarter and by 141% year-on-year; the average daily turnover of derivative products also increased by 7% for the quarter and by 10% year-on-year. This strong financial report is expected to drive market re-evaluation.