Daily Investment Strategy
Daily focus：HSBC Holdings（0005）
The company delivered a strong performance in Q1 2025, with pre-tax profit reaching USD 9.5 billion, up 11% year-on-year, and revenue increasing by 7%. The annualized return on tangible equity (RoTE) rose to 18.4%, a 2-percentage point improvement from the prior year. Wealth management, foreign exchange, and debt and equity markets businesses drove revenue and profit growth, while customer loans and deposits remained stable. HSBC declared an interim dividend of USD 0.10 per share and completed a USD 2 billion share buyback, with plans to initiate an additional buyback program of up to USD 3 billion. Management remains optimistic on the 2025-2027 medium-term targets, expecting RoTE to stay in the mid-double-digit range and a common equity tier 1 (CET1) ratio target of 14%-14.5%. Wealth management continued rapid expansion, with net new investment assets of USD 22 billion in Q1, including USD 16 billion from Asia and 300,000 new customers in Hong Kong, reflecting strong client demand for diversified products.
China's manufacturing sector's confidence in stocking up weakens
On Wednesday, China's National Bureau of Statistics released the first set of economic data regarding the impact of high tariffs between China and the United States. In the latest Purchasing Managers' Index (PMI), the manufacturing PMI fell back into contraction territory, with a reported value of 49, below the market expectation of 49.7. In the details, it can be seen that new export orders, which have been in contraction for 12 consecutive months, further declined to 44.7, the lowest level in the past year. At the same time, the manufacturing purchasing volume index also hit its lowest level since 2023, reported at 46.3, and raw material inventory remained at a low level of 47, reflecting manufacturers' more cautious outlook on subsequent production.
Hong Kong Stock Connect recorded a net inflow of HK$56 billion on Wednesday, of which Tracker Fund of Hong Kong (2800) recorded the largest net inflow of HK$1.58 billion, followed by Meituan (3690); Industrial and Commercial Bank of China (1398) recorded the largest net outflow of HK$360 million, followed by Xpeng Motors (9868).
Cheung Cho Shing, Joseph 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/ACQ030/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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