Nominal 
{Economic Information Daily reporter She Shiwai reported on the 24th} The U.S. Treasury recently announced it will increase the scale of long-term debt buybacks, but U.S. long-term bond yields, after a one-day decline, quickly rebounded and remained at the highest level since before the financial tsunami. Coupled with the Middle East situation showing no short-term improvement, global stock markets continue to be disrupted—where will the market head next? Jim Rogers, the renowned investor known as the "Commodities King," expressed extremely pessimistic and cautious views on U.S. stocks. He stated he has completely liquidated all his U.S. and European stock holdings and predicted that the U.S. is brewing "the worst financial crisis in my lifetime," under which even relatively undervalued Hong Kong stocks would struggle to remain unscathed.
As market risk awareness increases, some investors are beginning to position high-dividend stocks for defense. Among the wide range of high-dividend stocks, which sectors or individual stocks are worth watching?
*'Domestic banks + Hong Kong banks' combo wins on dividend income*
Mak Ka Ka, Head of Financial Products Trading and Head of Research at Yuanta Securities (Asia), told the {Economic Information Daily} that Hong Kong stocks offer many high-dividend options, such as domestic consumption stocks, many of which offer dividend yields as high as 5% or even higher. However, mainland China's consumption has been weak in recent years, making these stocks potentially more volatile. Although the dividends are attractive, stock prices may fall due to business outlooks, possibly resulting in net losses. Therefore, for investors seeking high dividends, low risk is also a key consideration. Mak Ka Ka noted that bank stocks have always been top performers among high-dividend stocks. However, some bank stocks, such as HSBC (00005), currently have dividend yields falling below 4%, making them less attractive to investors. In contrast, mainland Chinese banks, which have long held a place among dividend-paying stocks, despite recent strong stock price performance, still offer dividend yields around 4% to nearly 5%. Mak Ka Ka believes mainland banks have better asset quality and relatively stable profitability. Even if they occasionally record annual declines, the跌幅 are slight, and the overall dividend payouts over the past decade have shown an upward trend, all of which are attractive to investors.
Mak Ka Ka believes that for investors interested in bank stocks, China Construction Bank (00939) and Bank of China (Hong Kong) (02388) are good choices, with both currently offering forecasted dividend yields of about 5%. She recommends this "domestic banks + Hong Kong banks" combination primarily to diversify risk and reduce volatility. Although bank stocks are more stable than other industries, slowing mainland economic growth and uncertain trends in banks' net interest margins remain structural risks. In contrast, Bank of China (Hong Kong), rooted in Hong Kong, is less affected by the mainland's economic slowdown. This combination offers a dual approach, allowing investors to enjoy high bank stock dividends while reducing exposure to a single market. Regarding entry points, Mak Ka Ka suggests using the 10-day moving average on the weekly chart (around HK$8.50) as a reference for China Construction Bank; similarly, for Bank of China (Hong Kong), buying near the 10-day moving average on the weekly chart (around HK$48) is advisable.
*'Gas + Power' strong complementary effect*
Besides bank stocks, Mak Ka Ka believes Hong Kong's utility stocks also possess high-yield, low-risk characteristics. Since this sector is less affected by economic cycles, its income and cash flows are relatively stable and highly predictable. Additionally, some utility stocks, while maintaining steady income, are also seeking future growth opportunities. Taking Towngas (00003) as an example, in addition to better-than-expected interim results, the company has made breakthrough progress in commercializing new green sustainable aviation fuels and green methanol, seeking new breakthroughs. Although this business currently accounts for a small proportion, the company continues to strive in other areas, such as expanding utility connections in mainland China. However, after the interim results announcement, Towngas's stock price rose sharply, so she suggests waiting for a pullback near HK$6.80 for a more attractive entry point. Besides Towngas, Power Assets (00006) is another good choice among utility stocks, with both offering dividend yields between 4.5% and 5%. Power Assets has a higher proportion of operations in Hong Kong and overseas, forming a complementary combination with Towngas. The stock boasts strong cash flow and stable dividend payouts. Additionally, Power Assets has capital reinvestment potential and could be considered for entry near the 100-day moving average (around HK$59.70).
*'Three oil giants' outlook positive; Ping An outperforms China Life*
Nip Chun Pong, Chief Analyst at High Wealth Securities, told the {Economic Information Daily} that recent risk-averse sentiment has been high, driving demand for high-dividend stocks. Local utility stocks such as Towngas, Power Assets, CLP (00002), and Cheung Kong Infrastructure (01038) have seen accumulated gains, with stock prices no longer low, leading to price rebounds. Mainland bank stocks are in a similar situation—due to sustained price increases, their dividend yields have now fallen to just over 4%. In contrast, some traditional high-dividend Chinese stocks, even after deducting the 20% dividend tax levied by the mainland government, still offer dividend yields close to those of utility stocks. Among these, the 'three oil giants,' domestic insurers, and telecom stocks are relatively more attractive.
Regarding the 'three oil giants,' Nip Chun Pong noted that dividend yields generally remain between 5% and 6%. Since the U.S.-Iran conflict, although oil prices have been volatile, they have had little impact on the stock prices of CNOOC (00883) and PetroChina (00857). As the 'three oil giants' are mainly influenced by mainland economic activity, mainland economic data such as GDP growth, the performance of the 'three engines' of growth, and manufacturing PMI have a greater impact. Although mainland China's second-quarter economic growth slowed, the interim results of the 'three oil giants' remain promising, potentially driving stock prices up another 8% to 10%. Recently, the 'three oil giants' stock prices have rebounded from their late June and early July lows, with CNOOC seeing the largest cumulative gain. It is expected to face resistance near HK$28, and investors should wait for a pullback to around HK$22.50–23.00 for a higher risk-reward ratio.
Regarding domestic insurance stocks, Nip Chun Pong stated that mainland China's second-quarter economic performance was lackluster, but the central government may intensify stimulus efforts, potentially improving economic performance in the second half of the year, which would benefit insurers. Additionally, the central government's earlier move to strengthen regulation on illegal overseas investments, coupled with the China National Financial Regulatory Administration's recent announcement supporting mainland insurance funds investing via the Stock Connect program in Hong Kong-listed ETFs included in the Southbound Connect, has created favorable conditions for mainland insurance funds to invest through the Stock Connect. Among domestic insurance leaders, Nip Chun Pong is more optimistic about Ping An (02318). In contrast, China Life (02628), besides its weaker first-quarter performance, offers a dividend yield of only over 3%, making it less attractive. Besides the two leading insurers, New China Insurance (01336) is also worth considering. Its first-quarter performance even surpassed that of the two major domestic insurers, and it is expected to likely continue its first-quarter growth momentum into the second quarter. Its dividend yield is similar to Ping An's, ranging from 5% to 6%.
*China Unicom's dividend suspension sparks panic; China Mobile the top telecom pick*
Nip Chun Pong noted that telecom stocks also possess high-dividend characteristics and are worth recommending. However, China Unicom (00762)'s recently announced results were disappointing, with interim net profit down 34.6% year-on-year and revenue up only 0.6%. Moreover, it suspended its interim dividend for the first time since 2021, shocking investors. Nip Chun Pong stated that China Unicom's sudden halt to its interim dividend payment was unexpected by the market, and with high uncertainty remaining in the second half, it may not maintain a high-dividend policy by the end of the fiscal year. Besides China Unicom, China Telecom (00728) also saw a year-on-year decline in interim net profit. Although it maintained its interim dividend, the amount decreased by over 10% year-on-year. Therefore, Nip Chun Pong believes among the three major telecom operators, China Mobile (00941) remains the most stable. Although its interim revenue and net profit both slightly declined year-on-year, it maintained its interim dividend at last year's level. Its current dividend yield remains above 6%, and even after deducting the 20% dividend tax, it still firmly stays above 5%, continuing to attract income-seeking investors.
As market risk awareness increases, some investors are beginning to position high-dividend stocks for defense. Among the wide range of high-dividend stocks, which sectors or individual stocks are worth watching?
*'Domestic banks + Hong Kong banks' combo wins on dividend income*
Mak Ka Ka, Head of Financial Products Trading and Head of Research at Yuanta Securities (Asia), told the {Economic Information Daily} that Hong Kong stocks offer many high-dividend options, such as domestic consumption stocks, many of which offer dividend yields as high as 5% or even higher. However, mainland China's consumption has been weak in recent years, making these stocks potentially more volatile. Although the dividends are attractive, stock prices may fall due to business outlooks, possibly resulting in net losses. Therefore, for investors seeking high dividends, low risk is also a key consideration. Mak Ka Ka noted that bank stocks have always been top performers among high-dividend stocks. However, some bank stocks, such as HSBC (00005), currently have dividend yields falling below 4%, making them less attractive to investors. In contrast, mainland Chinese banks, which have long held a place among dividend-paying stocks, despite recent strong stock price performance, still offer dividend yields around 4% to nearly 5%. Mak Ka Ka believes mainland banks have better asset quality and relatively stable profitability. Even if they occasionally record annual declines, the跌幅 are slight, and the overall dividend payouts over the past decade have shown an upward trend, all of which are attractive to investors.
Mak Ka Ka believes that for investors interested in bank stocks, China Construction Bank (00939) and Bank of China (Hong Kong) (02388) are good choices, with both currently offering forecasted dividend yields of about 5%. She recommends this "domestic banks + Hong Kong banks" combination primarily to diversify risk and reduce volatility. Although bank stocks are more stable than other industries, slowing mainland economic growth and uncertain trends in banks' net interest margins remain structural risks. In contrast, Bank of China (Hong Kong), rooted in Hong Kong, is less affected by the mainland's economic slowdown. This combination offers a dual approach, allowing investors to enjoy high bank stock dividends while reducing exposure to a single market. Regarding entry points, Mak Ka Ka suggests using the 10-day moving average on the weekly chart (around HK$8.50) as a reference for China Construction Bank; similarly, for Bank of China (Hong Kong), buying near the 10-day moving average on the weekly chart (around HK$48) is advisable.
*'Gas + Power' strong complementary effect*
Besides bank stocks, Mak Ka Ka believes Hong Kong's utility stocks also possess high-yield, low-risk characteristics. Since this sector is less affected by economic cycles, its income and cash flows are relatively stable and highly predictable. Additionally, some utility stocks, while maintaining steady income, are also seeking future growth opportunities. Taking Towngas (00003) as an example, in addition to better-than-expected interim results, the company has made breakthrough progress in commercializing new green sustainable aviation fuels and green methanol, seeking new breakthroughs. Although this business currently accounts for a small proportion, the company continues to strive in other areas, such as expanding utility connections in mainland China. However, after the interim results announcement, Towngas's stock price rose sharply, so she suggests waiting for a pullback near HK$6.80 for a more attractive entry point. Besides Towngas, Power Assets (00006) is another good choice among utility stocks, with both offering dividend yields between 4.5% and 5%. Power Assets has a higher proportion of operations in Hong Kong and overseas, forming a complementary combination with Towngas. The stock boasts strong cash flow and stable dividend payouts. Additionally, Power Assets has capital reinvestment potential and could be considered for entry near the 100-day moving average (around HK$59.70).
*'Three oil giants' outlook positive; Ping An outperforms China Life*
Nip Chun Pong, Chief Analyst at High Wealth Securities, told the {Economic Information Daily} that recent risk-averse sentiment has been high, driving demand for high-dividend stocks. Local utility stocks such as Towngas, Power Assets, CLP (00002), and Cheung Kong Infrastructure (01038) have seen accumulated gains, with stock prices no longer low, leading to price rebounds. Mainland bank stocks are in a similar situation—due to sustained price increases, their dividend yields have now fallen to just over 4%. In contrast, some traditional high-dividend Chinese stocks, even after deducting the 20% dividend tax levied by the mainland government, still offer dividend yields close to those of utility stocks. Among these, the 'three oil giants,' domestic insurers, and telecom stocks are relatively more attractive.
Regarding the 'three oil giants,' Nip Chun Pong noted that dividend yields generally remain between 5% and 6%. Since the U.S.-Iran conflict, although oil prices have been volatile, they have had little impact on the stock prices of CNOOC (00883) and PetroChina (00857). As the 'three oil giants' are mainly influenced by mainland economic activity, mainland economic data such as GDP growth, the performance of the 'three engines' of growth, and manufacturing PMI have a greater impact. Although mainland China's second-quarter economic growth slowed, the interim results of the 'three oil giants' remain promising, potentially driving stock prices up another 8% to 10%. Recently, the 'three oil giants' stock prices have rebounded from their late June and early July lows, with CNOOC seeing the largest cumulative gain. It is expected to face resistance near HK$28, and investors should wait for a pullback to around HK$22.50–23.00 for a higher risk-reward ratio.
Regarding domestic insurance stocks, Nip Chun Pong stated that mainland China's second-quarter economic performance was lackluster, but the central government may intensify stimulus efforts, potentially improving economic performance in the second half of the year, which would benefit insurers. Additionally, the central government's earlier move to strengthen regulation on illegal overseas investments, coupled with the China National Financial Regulatory Administration's recent announcement supporting mainland insurance funds investing via the Stock Connect program in Hong Kong-listed ETFs included in the Southbound Connect, has created favorable conditions for mainland insurance funds to invest through the Stock Connect. Among domestic insurance leaders, Nip Chun Pong is more optimistic about Ping An (02318). In contrast, China Life (02628), besides its weaker first-quarter performance, offers a dividend yield of only over 3%, making it less attractive. Besides the two leading insurers, New China Insurance (01336) is also worth considering. Its first-quarter performance even surpassed that of the two major domestic insurers, and it is expected to likely continue its first-quarter growth momentum into the second quarter. Its dividend yield is similar to Ping An's, ranging from 5% to 6%.
*China Unicom's dividend suspension sparks panic; China Mobile the top telecom pick*
Nip Chun Pong noted that telecom stocks also possess high-dividend characteristics and are worth recommending. However, China Unicom (00762)'s recently announced results were disappointing, with interim net profit down 34.6% year-on-year and revenue up only 0.6%. Moreover, it suspended its interim dividend for the first time since 2021, shocking investors. Nip Chun Pong stated that China Unicom's sudden halt to its interim dividend payment was unexpected by the market, and with high uncertainty remaining in the second half, it may not maintain a high-dividend policy by the end of the fiscal year. Besides China Unicom, China Telecom (00728) also saw a year-on-year decline in interim net profit. Although it maintained its interim dividend, the amount decreased by over 10% year-on-year. Therefore, Nip Chun Pong believes among the three major telecom operators, China Mobile (00941) remains the most stable. Although its interim revenue and net profit both slightly declined year-on-year, it maintained its interim dividend at last year's level. Its current dividend yield remains above 6%, and even after deducting the 20% dividend tax, it still firmly stays above 5%, continuing to attract income-seeking investors.
