Where are Asian stocks going?

Morgan Stanley analysts see Hong Kong as a particularly risky market, pointing out the likelihood of a further significant decline in the Hang Seng benchmark.

Analysts and strategists at the bank in June reduced 12-month target for the Hang Seng index to 27,200 from their previous target of 30,350. The new target represents nearly 3% more down compared to the current level of the index traded in Asia on Thursday morning. The benchmark is currently in correctional territory, down more than 19% from the January highs.

Morgan Stanley's reasons for the review include Hong Kong's sensitivity to world monetary policy. the greenback), the weakness of the yuan, as well as the decline in flows to the south via the regimes linking the mainland investors to the Hong Kong market.

Morgan Stanley also lowered its target for the continental market, revising its forecast for the CSI 300 – an index of the largest stocks traded on the continent – to 3,500 versus 4,200. "Although the CNY is not affected by the weakening, the CSI 300 suffers more than we expected," note analysts in a note, citing the slowdown in Chinese data and the slowdown in credit parallel banking.

stuck to their weapons when it comes to their calls in China.

JP Morgan has a year – end target of 105 for the MSCI China index, which tracks Chinese high and mid – cap offshore stocks, for its benchmark scenario. The MSCI China index stood at 83,757 as of July 4th.

Pedro Martins, Emerging Equities Specialist at JP Morgan, said strong earnings rises were a key reason, despite some risks associated with trade tensions between the United States. and China stayed. Nevertheless, he said that macroeconomic developments, such as Beijing's deleveraging efforts, were positive in the long run.

Nomura maintained its target for the MSCI China Index at 80, a decrease of 4% from current levels. Wendy Liu, head of Chinese equity research at Nomura, said the target still seemed applicable as it started with a conservative estimate.

And despite recent market fluctuations, Liu said that for the investor sentiment.