JPMorgan has released a research note indicating that China's August credit data fell short of expectations. The nation's aggregate social financing increment reached 1.66 trillion yuan, below the bank's own forecast of 2.27 trillion yuan and the market's consensus of 2.12 trillion yuan. New yuan loans came in at just 60 billion yuan, also significantly missing projections.

Within the loan breakdown, retail lending contracted further by 0.2% month-over-month, while medium-to-long-term corporate loans and discounted bills demonstrated resilience. Against this backdrop of relatively strong corporate activity, JPMorgan expresses a preference for state-owned banks that boast more robust corporate banking capabilities.

As such, the firm's top sector picks are Bank of China (03988) and CCB (00939), both of which carry an "Overweight" rating. JPMorgan has set target prices of HK$6.70 for Bank of China and HK$11.05 for CCB.