Morgan Stanley's 2026 Outlook: The report provides forecasts for the price-to-book (PB), return on equity (ROE), and dividend yield of various Chinese banks' H-shares for the year 2026.

Bank Performance Metrics: Key banks such as ABC, ICBC, and CCB show varying PB ratios, ROE percentages, and dividend yields, with ICBC having the lowest PB at 0.48x and CM Bank leading in ROE at 12.6%.

Short Selling Data: The report includes short selling statistics for each bank, indicating significant short selling activity, particularly for PSBC and CM Bank, with ratios of 51.978% and 45.638%, respectively.

Market Reactions: The stock prices of the banks reflect mixed performance, with some banks experiencing slight increases while others show declines, highlighting the volatility in the Chinese financial sector.

Morgan Stanley's 2026 Outlook: The report provides a ranking of H-shares for Chinese banks, indicating a preference for several banks with "Overweight" investment ratings.

Top Ranked Banks: The top banks listed include Minsheng Bank, CITIC Bank, Bank of China, CCB, and PSBC, all rated "Overweight" with specific target prices.

Short Selling Data: The report includes short selling statistics for each bank, highlighting the amount and ratio of short selling activity.

Underperforming Banks: Some banks, such as Bank of Communications, CEB Bank, and CQRC Bank, received "Underweight" ratings, indicating a less favorable outlook.

Morgan Stanley's Market Outlook: Morgan Stanley predicts that the Chinese financial market will hit its lowest point in 2025 before entering a positive growth cycle, characterized by a recovery in loans and financial asset yields, stable credit costs, and an active capital market.

Preferred Sectors and Stocks: The insurance sector is highlighted as a top pick, particularly PING AN, while BANK OF NINGBO and MINSHENG BANK are noted for their strong performance and turnaround potential, respectively.

Stock Performance: Major Chinese banks, including ICBC, CCB, and Bank of China, experienced slight declines in stock prices, with short selling ratios varying significantly across institutions.

Short Selling Data: The short selling activity indicates a high level of investor skepticism, particularly for CM Bank and PSBC, which have the highest short selling ratios among the listed banks.

Market Insights: Morgan Stanley has raised the target price for CM Bank to HKD 63.4, reflecting a revised risk-reward assessment for the bank.

General Market Context: The stock quotes for Hong Kong banks are delayed by at least 15 minutes, and the short selling data is current as of December 23, 2025.

Morgan Stanley's Report: Morgan Stanley has updated its risk-return assessment for MINSHENG BANK (01988.HK) and revised its earnings forecasts based on the bank's 3Q25 results.

Earnings Forecast Changes: The bank's NIM and post-result credit cost forecasts were lifted, but EPS forecasts for 2025-27 were reduced by 2.1%, 6.5%, and 7.9% respectively.

Target Price and Rating: Morgan Stanley maintained its target price for MINSHENG BANK at HKD6.1 and assigned an Overweight rating.

Market Context: The report notes that short selling for MINSHENG BANK is at $44.00M with a ratio of 45.008%, and highlights expectations for a 50 basis point cut in RRR by the PBOC in 1Q26.