Huatai Securities says near-term focus should be on Hong Kong names that are
deeply oversold, carry heavy short interest and show marginal stabilization or
improvement in earnings expectations—notably innovative drugmakers and electric
utilities—and on high-dividend defensive banks. Innovative-drug fundamentals are
still improving; global style rebalancing has triggered catch-up moves and
short-covering may continue. Prioritise CXO names with positive guidance and
leading drugmakers with strong BD potential. For the AI hardware chain, further
near-term increases offer limited risk/reward; the next critical window is the
US July earnings season, so adjust exposure according to unrealized gains. AI
software is more a source of stock-specific alpha tied to model leadership. On a
medium-term view, maintain a balanced allocation between sectors showing
accelerating demand and undervalued reversal candidates.
