In most markets, margin expansion has been playing a major role in driving overall earnings growth, HSBC analysts said.
Refinitiv data, though, showed that analysts have turned positive on China’s forward 12-month earnings, lifting the consensus earnings estimates by 0.5 percent over the past month after three straight months of cuts. Rajat Agarwal, Asia equity strategist at Societe Generale, said China’s earnings estimates have been resilient in 2023 with growth of 20 percent expected, despite the economic slowdown.Substantive actions will need to follow policymakers’ words to help shore up shaken confidence in China, investors and analysts said.
“We see China market performance picking in the coming months – especially given the low expectations and valuations.”