Hong Kong stock concept tracking | Industrial and Commercial Bank of China to announce first quarter 2025 performance Institution optimistic about stable financial data (with concept stocks)

Mainland banks will announce their first quarter performance at the end of this month. UBS predicts that the revenue and pre-tax operating profit of state-owned enterprise banks in the first quarter will continue the improvement trend from the fourth quarter of last year, and net profit will remain stable and increase positively (up 1.6% year-on-year). Therefore, it is expected that the first quarter will be a stable one. UBS mentioned that although the impact of US tariffs will not directly affect domestic banks, potential economic slowdown in China may bring some indirect effects. Therefore, UBS predicts that future interest rate cuts, weak loan demand, and asset quality risks will be frequently mentioned in this financial reporting quarter, and it is expected that various domestic bank stocks will remain resilient. CMB International released a research report stating that the balance sheet resilience of Bank Of China's business provides stability in the current operating environment susceptible to potential policy changes, helping to mitigate fluctuations related to tariffs, and the Bank Of China system is more capable of coping with the new US tariff regime than a decade ago. The MSCI Bank Of China Index has achieved a 2% absolute return year-to-date, surpassing the MSCI World Bank Index by 4%. This is not surprising, as global banks have high profit volatility. Despite a challenging operating environment since the 2025 fiscal year, Bank Of China's profits are expected to remain stable. CITIC Securities pointed out that last week, capital market volatility increased, and bank stocks showed relative returns. Looking at the released bank annual reports and first quarter profit forecasts, the fundamentals of the banking sector are in line with market expectations. Looking ahead to 2025, capital markets may be impacted by a combination of factors such as Sino-US tariffs, domestic hedge policy expectations, and economic performance, and volatility may remain high. In this context, bank stocks benefit from stable financial data, dividend value certainty, and relatively low valuation fluctuations, making them optimistic in terms of relative and absolute value, and recommending an increase in sector allocation. Companies in the domestic banking sector include: - Industrial and Commercial Bank of China (01398) - Agricultural Bank Of China (01288) - China Construction Bank Corporation (00939) - Bank Of China (03988) - China Merchants Bank (03968) - CITIC BANK (00998)