JPM Projects Growth Potential for CN Brokers' Revenue and Investment Income in Q3
Operational Improvement: Chinese brokers saw significant operational improvements in August, with A-shares' average daily turnover reaching a record RMB2.3 trillion and maintaining over RMB2 trillion for 18 consecutive trading days.
Market Activity and Outlook: The financing balance hit a record RMB2.28 trillion, new broker account openings surged by 35% month-over-month, and JPMorgan maintains a positive outlook for brokers' revenue and investment income in Q3 2025.
Trade with 70% Backtested Accuracy
Analyst Views on 02611
About the author
<BofAS> Investment Ratings and Target Prices for Chinese Brokers Listed in Hong Kong (Table)
Stock Performance Overview: Various Hong Kong stocks show mixed performance with CITIC SEC and HTSC declining, while GTHT and CICC experienced gains.
Investment Ratings: Most stocks are rated as "Buy," with HTSC rated "Neutral" and CMSC rated "Underperform."
Short Selling Data: Significant short selling activity is noted across several stocks, with CITIC SEC having the highest short selling ratio at 29.239%.
Market Sentiment: JPMorgan has identified CICC as a top pick, suggesting that brokers with high beta are likely to benefit from positive market sentiment.
HSI Drops 309 Points Amid Weakness in Brokers and Chinese Insurers; LENOVO GROUP Falls 5%
Market Performance: The HSI fell by 1.2% to close at 26,149, with significant declines in the HSCEI and HSTECH, reflecting a total market turnover of $268.275 billion.
CITIC Securities Decline: CITIC SEC's A-shares dropped 3.3% due to massive sell-offs, while its H-shares also fell by 3.5%, indicating pressure on the brokerage sector.
Tech Sector Struggles: Major tech stocks like BIDU-SW and TENCENT experienced declines, with BIDU-SW down 3.3% despite positive IPO news for Kunlunxin, while other tech giants also saw losses of over 2%.
Mixed Results in Other Sectors: While some stocks like XD INC and INSILICO surged, others in the chip and smartphone parts sectors, such as LENOVO GROUP and SUNNY OPTICAL, faced significant declines, highlighting volatility in the market.
BofAS Selects GTHT as 2026 Top Choice, Upgrades Rating to Buy and Raises Target Price to HKD20.2
Market Concerns: GTHT and GUOTAI HAITONG have faced stock price underperformance due to worries about asset quality, integration progress, and weak post-merger equity returns, as noted by BofA Securities.
Positive Outlook: BofA Securities anticipates that GTHT's 3Q25 results will alleviate concerns, indicating potential for improved equity returns and a re-evaluation of its valuation.
Strategic Moves: The company is expected to have limited impairment provisions for Haitong International in 4Q25 and has announced plans to acquire an Indonesian brokerage license, signaling confidence in its business turnaround.
Upgraded Rating: BofA Securities has upgraded GTHT's rating from Neutral to Buy, raising the target price from HKD17.3 to HKD20.2, and considers it a top pick for 2026 due to expected leading profit growth.
CN Brokers Rise as CSRC Loosens Regulations on Quality Firms
Stock Performance: Chinese brokers, including HTSC, GTHT, CITIC SEC, CMSC, and CGS, experienced significant stock price increases, with HTSC rising by 7.29% and GTHT by 5.84%, among others.
Short Selling Data: The short selling figures for these brokers indicate substantial activity, with CITIC SEC having the highest short selling amount at $66.65M and a ratio of 23.982%.
Regulatory Focus: Wu Qing, Chairman of the CSRC, announced that regulatory policies will emphasize classified supervision, supporting stronger institutions while limiting weaker ones, and optimizing risk control measures.
Capital Utilization: The CSRC plans to moderately loosen restrictions on quality institutions to enhance capital utilization efficiency and open up capital space and leverage limits.
GUOTAI JUNAN Drops Nearly 5% as CSRC Reportedly Asks Brokers to Halt RWA Tokenization Business in Hong Kong
CSRC's Advisory: The China Securities Regulatory Commission has advised local brokers to halt their real-world asset tokenization business in Hong Kong due to concerns over the offshore digital asset market.
Market Performance: Several Hong Kong stocks, including GUOTAI JUNAN, CITIC SEC, and CGS, experienced declines in their share prices and significant short selling activity.
JPM Projects Growth Potential for CN Brokers' Revenue and Investment Income in Q3
Operational Improvement: Chinese brokers saw significant operational improvements in August, with A-shares' average daily turnover reaching a record RMB2.3 trillion and maintaining over RMB2 trillion for 18 consecutive trading days.
Market Activity and Outlook: The financing balance hit a record RMB2.28 trillion, new broker account openings surged by 35% month-over-month, and JPMorgan maintains a positive outlook for brokers' revenue and investment income in Q3 2025.
<BofAS> Investment Ratings and Target Prices for Chinese Brokers Listed in Hong Kong (Table)
Stock Performance Overview: Various Hong Kong stocks show mixed performance with CITIC SEC and HTSC declining, while GTHT and CICC experienced gains.
Investment Ratings: Most stocks are rated as "Buy," with HTSC rated "Neutral" and CMSC rated "Underperform."
Short Selling Data: Significant short selling activity is noted across several stocks, with CITIC SEC having the highest short selling ratio at 29.239%.
Market Sentiment: JPMorgan has identified CICC as a top pick, suggesting that brokers with high beta are likely to benefit from positive market sentiment.
HSI Drops 309 Points Amid Weakness in Brokers and Chinese Insurers; LENOVO GROUP Falls 5%
Market Performance: The HSI fell by 1.2% to close at 26,149, with significant declines in the HSCEI and HSTECH, reflecting a total market turnover of $268.275 billion.
CITIC Securities Decline: CITIC SEC's A-shares dropped 3.3% due to massive sell-offs, while its H-shares also fell by 3.5%, indicating pressure on the brokerage sector.
Tech Sector Struggles: Major tech stocks like BIDU-SW and TENCENT experienced declines, with BIDU-SW down 3.3% despite positive IPO news for Kunlunxin, while other tech giants also saw losses of over 2%.
Mixed Results in Other Sectors: While some stocks like XD INC and INSILICO surged, others in the chip and smartphone parts sectors, such as LENOVO GROUP and SUNNY OPTICAL, faced significant declines, highlighting volatility in the market.
BofAS Selects GTHT as 2026 Top Choice, Upgrades Rating to Buy and Raises Target Price to HKD20.2
Market Concerns: GTHT and GUOTAI HAITONG have faced stock price underperformance due to worries about asset quality, integration progress, and weak post-merger equity returns, as noted by BofA Securities.
Positive Outlook: BofA Securities anticipates that GTHT's 3Q25 results will alleviate concerns, indicating potential for improved equity returns and a re-evaluation of its valuation.
Strategic Moves: The company is expected to have limited impairment provisions for Haitong International in 4Q25 and has announced plans to acquire an Indonesian brokerage license, signaling confidence in its business turnaround.
Upgraded Rating: BofA Securities has upgraded GTHT's rating from Neutral to Buy, raising the target price from HKD17.3 to HKD20.2, and considers it a top pick for 2026 due to expected leading profit growth.
CN Brokers Rise as CSRC Loosens Regulations on Quality Firms
Stock Performance: Chinese brokers, including HTSC, GTHT, CITIC SEC, CMSC, and CGS, experienced significant stock price increases, with HTSC rising by 7.29% and GTHT by 5.84%, among others.
Short Selling Data: The short selling figures for these brokers indicate substantial activity, with CITIC SEC having the highest short selling amount at $66.65M and a ratio of 23.982%.
Regulatory Focus: Wu Qing, Chairman of the CSRC, announced that regulatory policies will emphasize classified supervision, supporting stronger institutions while limiting weaker ones, and optimizing risk control measures.
Capital Utilization: The CSRC plans to moderately loosen restrictions on quality institutions to enhance capital utilization efficiency and open up capital space and leverage limits.
GUOTAI JUNAN Drops Nearly 5% as CSRC Reportedly Asks Brokers to Halt RWA Tokenization Business in Hong Kong
CSRC's Advisory: The China Securities Regulatory Commission has advised local brokers to halt their real-world asset tokenization business in Hong Kong due to concerns over the offshore digital asset market.
Market Performance: Several Hong Kong stocks, including GUOTAI JUNAN, CITIC SEC, and CGS, experienced declines in their share prices and significant short selling activity.
JPM Projects Growth Potential for CN Brokers' Revenue and Investment Income in Q3
Operational Improvement: Chinese brokers saw significant operational improvements in August, with A-shares' average daily turnover reaching a record RMB2.3 trillion and maintaining over RMB2 trillion for 18 consecutive trading days.
Market Activity and Outlook: The financing balance hit a record RMB2.28 trillion, new broker account openings surged by 35% month-over-month, and JPMorgan maintains a positive outlook for brokers' revenue and investment income in Q3 2025.
