HK Stock Market Move | Inland property stocks fell across the board with R&F PROPERTIES (02777) dropping more than 10%. Institutions suggested that the market's reaction to relaxing the three red lines was excessive.

Neff shares fell across the board, as of press time, R&F PROPERTIES (02777) fell 9.38% to HK$0.58; SUNAC (01918) fell 8.27% to HK$1.22; CH OVS G OCEANS (00081) fell 2.57% to HK$2.65. On the news front, according to reports from Caixin, several real estate companies are no longer required by regulators to report "three red lines" related data monthly. BOC International released a research report stating that the "three red lines" policy itself is not the catalyst for the current market adjustment, and is not the main constraint on the development and finances of real estate companies. The bank believes that relaxing the "three red lines" will not have a significant effect, and the adjustment of Neff shares is an overreaction, with a significant risk in the current stock price of companies with large increases. JPMorgan Chase also stated that for struggling private developers, the core issue is still liquidity and survival, whether or not there are "three red lines". Simply relaxing financial indicators will not change the situation without additional bank support. As for state-owned developers, theoretically this may allow them to increase leverage in land acquisition. However, in the current market environment, the bank believes that state-owned enterprises do not have a strong desire to increase leverage, but will instead remain cautious and continue to adhere to the "three red lines".