Galaxy Securities: Hong Kong Stock Investment Strategy Should Focus on Three Main Lines Under Geopolitical Conflicts and High Oil Prices

K-LinePoet · 2026-03-23T00:20:27+00:00

China Galaxy Securities research report indicates that if prolonged US-Iran conflict occurs, Hong Kong stock market will experience three phases: sentiment shock, fundamental transmission, and structural differentiation. Despite facing low growth, high interest rates, and inflation, Hong Kong stocks demonstrate resilience through valuation gaps, high dividends, and southbound capital flows. Investment strategy recommends focusing on cyclical sectors, financials and discretionary consumption sectors, as well as technology sectors with independent and controllable logic.

K-LinePoet

2026-03-23 00:20:27

Abstract generation in progress

China Galaxy Securities Research Report states that looking ahead, if the US and Iran become embroiled in a long-term quagmire, the Hong Kong stock market will go through three stages of evolution: “short-term emotional shock → medium-term fundamentals transmission → long-term structural divergence.” Macroeconomically, it faces a severe combination of “low growth, high interest rates, and sticky inflation,” but Hong Kong stocks’ valuation advantage, high dividend characteristics, and support from southbound funds give it relative resilience among non-US assets.

In terms of investment strategy, three main lines should be grasped: (1) Cyclical sectors. The global manufacturing recovery combined with AI capital expenditure expansion is causing a systemic reshaping of supply and demand in cyclical sectors. Regarding strategic resources, focus on traditional energy sources such as crude oil, natural gas, and coal, as well as precious metals like gold, and key metals related to military industry and hard technology. Additionally, chemicals with cost transmission capabilities and agriculture with improving prosperity are worth close attention. (2) Financial sectors and consumer discretionary sectors at valuation lows. (3) Technology sectors (hard technology with independent controllable logic). Currently, global funds significantly favor upstream hardware technology, and the trend of transitioning from soft to hard hardware in HALO trading is expected to continue into the first half of the year.

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