Hong Kong's stock rally still has room to run on 'reasonable' valuations, Templeton says

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"constructive" on Hong Kong and mainland China's stock markets, as the valuations remained reasonable and Beijing had introduced supportive policies, said Ferdinand Cheuk, portfolio manager at Templeton Global Equity Group, on Wednesday in a briefing.While the city's benchmark Hang Seng Index had surged more than 25 per cent so far this year, outperforming major indices globally, the momentum could be maintained through stock selection and positioning in certain sectors, he said.Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.The average price-to-earnings ratio among Hong Kong stocks stood at around 10.8 times, slightly above the 10-year average of 10.4 times, Cheuk said. By comparison, the constituents of the Standard & Poor's 500 index traded at an average of 25 times, while Nasdaq stocks averaged 35 times, according to Bloomberg's data.Ferdinand Cheuk Siu-yuen, Senior Vice-President and Portfolio Manager at Templeton Global Equity Group, during the Franklin Templeton press conference on January 16, 2019. Photo: Tory Ho alt=Ferdinand Cheuk Siu-yuen, Senior Vice-President and Portfolio Manager at Templeton Global Equity Group, during the Franklin Templeton press conference on January 16, 2019. Photo: Tory Ho>In addition, the decreasing uncertainty from the US-inflicted trade tensions would be helpful for fund managers and investors to predict companies' earnings, Cheuk said."We believe it is fair to say that the risks from Trump's current trade war and trade policies will diminish in the future," said Christy Tan, investment strategist at Franklin Templeton Institute, at the same briefing. Tan added that the US tariffs on China's imports were largely expected to be below 40 per cent.On Tuesday, US Treasury Secretary Scott Bessent said that the status quo situation with China was progressing well after the world's two biggest economies extended a truce last week in their trade dispute surrounding tariffs.Franklin Templeton's analysts were bullish on China's technology sector. Internet giants like Tencent were trading at a reasonable price-to-earnings and were still worth investors' attention, Cheuk said.Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P 5006,464.18 +94.01 (+1.48%)Dow 3045,623.37 +837.87 (+1.87%)Nasdaq21,490.57 +390.26 (+1.85%)Russell 20002,361.73 +87.64 (+3.85%)VIX14.39 -2.21 (-13.31%)Gold3,415.30 +33.70 (+1.00%)PortfolioSign in to access your portfolioSign inTop gainersUI Ubiquiti Inc. 510.25 +119.68 (+30.64%)MNSO MINISO Group Holding Limited 26.43 +4.26 (+19.22%)NIO NIO Inc. 6.36 +0.82 (+14.83%)RXO RXO, Inc. 16.86 +2.16 (+14.69%)TIGR UP Fintech Holding Limited 12.79 +1.56 (+13.85%)Top losersNEGG Newegg Commerce, Inc. 100.72 -15.06 (-13.01%)BJ BJ's Wholesale Club Holdings, Inc. 97.15 -9.01 (-8.49%)INTU Intuit Inc. 663.64 -34.12 (-4.89%)DUOL Duolingo, Inc. 332.15 -13.37 (-3.87%)NKTR Nektar Therapeutics 27.03 -0.98 (-3.48%)Most activeOPEN Opendoor Technologies Inc. 4.8300 +1.2300 (+34.17%)NIO NIO Inc. 6.36 +0.82 (+14.83%)INTC Intel Corporation 24.97 +1.47 (+6.23%)NVDA NVIDIA Corporation 177.95 +2.97 (+1.70%)LCID Lucid Group, Inc. 2.0200 -0.0700 (-3.35%)Earnings eventsTrending tickersINTC Intel Corporation 24.96 +1.45 (+6.19%)OPEN Opendoor Technologies Inc. 4.8000 +1.2000 (+33.33%)ETH-USD Ethereum USD 4,817.71 +581.81 (+13.74%)GOOG Alphabet Inc. 206.77 +6.15 (+3.07%)GOOGL Alphabet Inc. 206.04 +6.29 (+3.15%)Top economic events