STOCKS | Bank of East Asia Cuts Hang Seng Index Year-End Target to 27,100

Bank of East Asia (0023) lowered its Hang Seng Index year-end target to 27,100 from 29,000, according to Ming Pao. Chan Wai-chung, senior investment strategist at BEA Wealth Management, cited weaker-than-expected mainland China consumption and fixed-asset investment data in April and May, increased AI spending by technology firms, and rising production costs such as energy and memory. He said the earnings recovery of heavyweight internet and consumer stocks has been weaker than expected, prompting the bank to cut its forecast for Hang Seng Index earnings growth this year to 5% year on year from 10%. Chan added that Hong Kong stocks have recently outperformed regional markets, benefiting this quarter from sector rotation into upstream semiconductors following positioning in the first half, but he does not expect the factor to last long.