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<Research>JPM Downgrades BANK OF CHINA/ BANKCOMM to Neutral/ Underweight
Recommend 48 Positive 69 Negative 75 |
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The risk-reward profile of H-share state-owned banks has become more unfavorable against a challenging macro backdrop, JPMorgan released a research report saying. If China's policy response beats expectations, A/H-shares state-owned banks may underperform growth names. If policy response disappoints, H-share banks will fall more than A-shares, with the People's Bank of China (PBOC)'s Securities, Funds and Insurance companies Swap Facility (SFISF) providing downside support to onshore market, but not offshore market. JPMorgan downgraded BANK OF CHINA (03988.HK) from Overweight to Neutral as it has the highest domestic commitment to the manufacturing sector, and it may be more affected by cross-border trade than its peers, making it vulnerable to an escalation of the trade war between China and the US. JPMorgan also downgraded BANKCOMM (03328.HK) from Neutral to Underweight, as its bank deposits will be shifted to the capital market under the PBOC's stepped-up interest rate cut policy, which will make it more vulnerable in liquidity and interest rate management. AAStocks Financial News |
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