Chinese Brokerages' Growing Return on Equity to Drive Stocks -- Market Talk

Dow Jones05-05

0351 GMT - Chinese brokerages' growing return on equity is likely to drive their stocks higher, say Citi Research's Judy Zhang and Calvin Leung in a note. The brokerages covered by Citi posted strong revenue and net profit after tax growth in 1Q. These companies are likely seeing decent momentum in China-listed share underwriting activities and onshore mutual fund sales, the analysts note. They estimate the covered brokerages' return on equity to reach around 10% this year. "We believe strong [1Q] results showcase China [brokerages'] earnings resilience during market turbulence and re-rating potential on attractive valuations," they add. Citi's top sector pick is China International Capital Corp.'s Hong Kong stock. (megan.cheah@wsj.com)

(END) Dow Jones Newswires

May 04, 2026 23:51 ET (03:51 GMT)

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