FSMone: The investment value of Hong Kong stocks attracted the Hang Seng Index's target price of 30,000 points this year

The Zhitong Finance App learned that Xie Youxuan, assistant manager of the FSMone (Hong Kong) portfolio management and research department, said that the Hang Seng Index valuation repair was basically achieved last year. Considering that valuation expansion only provides short-term momentum, the medium- to long-term trend of the index still depends on corporate profit recovery. If the Hang Seng Index expects to continue to rise in the future, it will need to be supported by another key factor — corporate profit growth.

He said that in each sector of the Hang Seng Composite Index, the top three industries for predicting profit growth in 2026 are optional consumption, raw materials, and information technology. Growth expectations for these sectors are higher than the market average, reflecting strong recovery momentum in corporate profits.

On the other hand, liquidity has become an important factor supporting the performance of Hong Kong stocks. Against the backdrop of increased volatility in global financial markets, sufficient capital inflows enhance market depth and investor confidence, and support overall market performance. Beishui continued to flow into Hong Kong stocks last year, with a total net inflow of over HK$1 trillion, reflecting the enthusiasm of mainland investors to invest in Hong Kong stocks. At the same time, benefiting from policies encouraging leading mainland companies to go public, Hong Kong stocks raised more than HK$285.8 billion in IPOs last year, ranking first in global exchanges.

Tse Yau Hsuan said that although Hong Kong stocks have recorded significant increases last year, given the continued expansion of AI applications to promote the development of technology companies and the combination of Beishui and IPOs to increase market liquidity, it is expected that structured investment opportunities for Hong Kong stocks will still exist. They can be regarded as one of the key markets to focus on in 2026, attracting investment value. Based on the target price-earnings ratio of 11 times, the target price of the Hang Seng Index in 2026 is at the level of 30,000 points. Based on the target price-earnings ratio of 12 times, the target price of the MSCI China Index for 2026 is 98.

Chen Jialang, general manager of FSMone (Hong Kong), said that AI development will continue to be the main driver of US stocks. Local semiconductor sales continue to be strong, and capital expenditure expectations for technology companies remain high, AI-related investments will continue to support overall economic growth and help offset the pressure brought about by the slowdown in consumption. However, the US labor market has been fatigued in recent months, and Federal Reserve officials will continue to change horses. Political pressure from the Trump administration will push the authorities to cut interest rates further.

He also said that considering that structural factors such as high stickiness in service inflation and continued high wage growth have not been eliminated, core inflation may rebound in the future and may not smoothly fall back to the 2% policy target. Rekindling inflation concerns will limit the room for further monetary policy relaxation at that time, so it is expected that the Federal Reserve will cut interest rates twice in 2026.