Morgan Stanley raised its target price for HKEX to HK$500 from HK$440 on Sunday, citing the operator’s strong year-to-date performance and higher investor confidence that the Chinese market is bottoming out.
HKEX has surged 41 per cent this year to close at HK$415.80 on Monday, as Morgan Stanley’s vote of confidence added to recent upgrades by Goldman Sachs and HSBC. The former raised its price target to HK$455 on May 30, while the latter advanced it to HK$438 on June 1.
A “shift from financial tightening to development” was expected to support Hong Kong’s trading and IPO volumes amid “loosening IPO requirements”, equity analysts including Richard Xu said in a note.
Market sentiment had remained high since the debut of Chinese artificial intelligence firm DeepSeek, which raised confidence in China’s innovation-driven model, they added. In addition, credit risks from US tariffs should be “very limited” and “much lower” than initial estimates.
Hong Kong’s stock market is the world’s top IPO venue this year after new listings raised HK$78 billion (US$10 billion) in the first five months – an improvement of more than 700 per cent year on year. The recovery came as Beijing and Hong Kong regulators encouraged mainland companies to list on the city’s exchange.
