LIVE MARKETS-More buybacks brighten Asia's below expectations Q3 earnings - HSBC

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MORE BUYBACKS BRIGHTEN ASIA'S BELOW EXPECTATIONS Q3 EARNINGS - HSBC

While Q3 earnings season in Asia came in weaker than expected, HSBC equity strategists have pointed out some good news for shareholders: Chinese companies did more buybacks and paid more dividends.

"...the cash yield is set to exceed 5% in 2024e. That's attractive, in our view," they wrote in a note, adding that banks in Singapore had a robust Q3 and announced plans to increase buybacks and dividends.

Overall though, EPS in Asia excluding Japan was on average 6% below consensus, with only 29% of companies beating expectations and 52% missing.

"Overall earnings grew 23% y-o-y, led by strong (but still below expectations) growth in Taiwan and Korea. Consensus downgraded full-year growth numbers for Asia, particularly in Korea, Thailand and India," says the HSBC equity strats.

Even in China where shareholder returns were strong, earnings (ex-insurance) grew only 7% year-on-year in Q3, led by internet stocks.

Meanwhile in Korea, jitters about the sustainability of high memory prices and the impact of potential U.S. tariffs on the auto supply chain has resulted in sharp cuts to consensus on full year 2024 and 2025 earning growth.

Elsewhere, as many as 45% of Indian firms missed expectations, the most since Q2 2021, HSBC said.

(Lucy Raitano)

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