Two tools supporting capital markets have been further refined, and GF Securities sees potential for a recovery in the brokerage sector; China Life’s core profit grew, but investment volatility and falling new policy sales weighed on its third-quarter performance.
Morgan Stanley expects the third round of the swap facility could exceed 100 billion yuan. Expectations of market support and resilient brokerage earnings could help the sector extend its rebound; the long-term earnings impact of equity investments on brokerages is expected to be neutral to slightly positive.
JPMorgan believes weaker trading activity, downward revisions to third-quarter earnings expectations and capital outflows jointly weighed on brokerage stocks. Net ETF inflows helped repair sentiment, but earnings expectations for CICC, China Merchants Securities and CITIC Securities diverged markedly.
