HK Stock Market Move | Chinese brokerage stocks extend afternoon losses as brokerages approach Q3 earnings disclosure period; institutions say quarterly profit affected by direct investment and co-investment disruptions.

Chinese brokerage stocks extended their afternoon losses. As of press time, Orient (03958) fell 4.46% to HK$5.57; CMSC (06099) fell 3.97% to HK$13.06; GF SEC (01776) fell 3.58% to HK$16.17; China Securities Co.,Ltd. (06066) fell 2.33% to HK$10.88. On the news front, listed brokerages are about to enter the third-quarter earnings disclosure period. Kailuan Securities released a research report stating that in the third quarter, with the stock market pulling back and the bond market rising, direct investment and co-investment returns became an important factor affecting the divergence in brokerage performance. In the third quarter, the CSI 300 fell 12.5%, the ChinaBond Composite Index rose 1.1%, and the STAR 50 and ChiNext indices fell 30.7% and 27.8%, respectively. Existing STAR Market direct investment and co-investment projects faced a pullback in floating gains. Guotai Haitong stated that it expects the adjusted operating revenue of 42 listed brokerages to rise 26% year on year to RMB 525.4 billion in the first three quarters, with net profit attributable to parent up 30% year on year to RMB 220.6 billion. Excluding large non-recurring gains and losses in the same period last year, net profit attributable to parent is expected to grow 37% year on year. Of this, the third quarter alone was RMB 65.4 billion, up 1% year on year and down 31% quarter on quarter.