Daily Investment Strategy
Recommended Stock：HSBC（5）
HSBC Holdings reported its third-quarter results for 2024, showing a revenue increase to $17 billion, up $800 million or 5% yoy, exceeding expectations. However, net interest income fell to $7.6 billion, a decrease of $1.6 billion compared to the previous year, with a net interest margin of 1.46%, down 24 bps yoy due to higher interest expense on liabilities because of higher interest rates. The profit before tax rose by $800 million to $8.5 billion, driven mainly by growth in wealth management and personal banking, as well as gains in foreign exchange, equities, and global debt market activities. The board approved a third dividend of $0.10 per share and plans to initiate a share buyback program of up to $3 billion, expected to be completed within four months before the full-year results announcement in February 2025. HSBC maintains its guidance from July 2024, with an average tangible equity return target of around 15% for 2025, despite rate cut cycle in the US. Target price: $80; Stop- Loss price: $65.
Fed official Goolsbee expects interest rates to be a ‘Fair Bit Lower’ Over Next Year
Chicago Federal Reserve President Austan Goolsbee reiterated on Thursday that he supports further interest rate cuts and is willing to slow down the pace of rate cuts. He said that inflation has declined over the past year and a half and is moving toward the Fed's 2% target, the labor market has cooled, and the economy is now close to stability and full employment. Therefore, about a year from now, interest rates should be "a fair bit lower than where they are today."
Hong Kong Stock Connect had a net inflow of HK4.66bn on Thursday of which Kuaishou (1024) had the largest net inflow, reaching HK$0.63bn; followed by Alibaba (9988). Sunac (1918) recorded the largest net outflow at 0.16bn, followed by Xiaomi (1810).
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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