Goldman Sachs backs HKEX with buy rating, citing Beijing’s policy support, AI stock boost

Wall Street investment bank Goldman Sachs has cast a vote of confidence in Hong Kong’s financial future by reaffirming its “buy rating” on Hong Kong Exchanges and Clearing (HKEX), as Beijing ramps up policy support to cement the city’s status as an international financial centre.

“We see multiple tailwinds to ADT [average daily turnover] and revenue growth” in the second half of this year, analysts Thomas Wang and Simone Chen wrote in a research note on Wednesday.

The move comes amid weak share performance of Hong Kong’s exchange operator and market doubts over the sustainability of its trading activity.

Shares of HKEX have lost about 5 per cent so far this year, roughly in line with the performance of the Hang Seng Index.

Goldman said there were favourable conditions for HKEX, including Beijing’s growing policy support and strong northbound trading driven by foreign interest in China’s artificial intelligence stocks.

Beijing has doubled down on its support for Hong Kong, with a series of policies rolled out by People’s Bank of China governor Pan Gongsheng at a forum in the city last week.