Chinese banking stocks are among the top gainers in today's session.
At the time of writing, shares of BANK OF CHINA (03988) are up 3.32% to HK$4.98, while CCB (00939) have gained 3.19% to HK$8.08. ICBC (01398) shares have risen 2.62% to HK$6.66, and ABC (01288) are trading 2.42% higher at HK$5.51.
Key Catalysts for the Rally
As of July 6th, 33 banks have finalized their dividend schedules for the 2025 fiscal year. Notably, ten of these banks are scheduled to distribute dividends this week (July 6th to 10th), with a combined payout exceeding 91.1 billion yuan. Major participants in this payout include BANK OF CHINA, Bank of Communications, and China Merchants Bank.
Furthermore, the scheduled release dates for the first-half 2026 performance reports of A-share listed banks have been announced. Ping An Bank is slated to be the first to disclose its interim results, with a scheduled release date of August 15th.
Analyst Perspective on the Sector
According to analysis from Guosen Securities, the Shenwan Bank Index declined by 9.1% in the second quarter, with the core issue being capital flows. The rapid intensification of the technology and growth stock rally led to a sharp increase in market risk appetite, diverting funds towards high-risk/high-reward tech sectors and resulting in a systematic reduction of holdings in the banking sector.
The analysis suggests that the capital flow disruptions seen in Q2 are likely nearing their end. This view is supported by two key factors: first, the substantial decline in the scale of broad-based ETFs indicates that outflow pressures have significantly eased; second, the valuation expansion in the tech sector has narrowed its attractiveness from a risk/reward perspective. The intensive interim reporting season in July and August is expected to shift the market's pricing logic from style rotation to earnings validation. With multiple factors aligning, it is highly probable that the extreme market conditions witnessed in the second quarter will not persist into the third quarter.