--- title: "Morgan Stanley Investment Management's Xu Changtai expects the Hang Seng Index to rise above 27,000, focusing on foreign capital increasing allocation to Hong Kong stocks" type: "News" locale: "en" url: "https://longbridge.com/en/news/282165954.md" description: "Morgan Asset Management's Chief Market Strategist for the Asia-Pacific region, Xu Changtai, expects the Hang Seng Index to return to 27,000 points, mainly benefiting from foreign capital inflows into the Hong Kong stock market. He pointed out that if the situation in the Middle East stabilizes, oil prices may fall back to $80 to $90, and the Federal Reserve may consider cutting interest rates. Xu Changtai believes that China's economic growth target is 4.5%, but issues in the real estate and labor markets will take time to resolve. Overseas investors have digested these issues and are focusing on the profitability of Chinese companies and government policies" datetime: "2026-04-09T09:16:25.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/282165954.md) - [en](https://longbridge.com/en/news/282165954.md) - [zh-HK](https://longbridge.com/zh-HK/news/282165954.md) --- # Morgan Stanley Investment Management's Xu Changtai expects the Hang Seng Index to rise above 27,000, focusing on foreign capital increasing allocation to Hong Kong stocks Before the outbreak of the US-Iran war, JP Morgan Asset Management maintained its forecast that the Federal Reserve would cut interest rates at least once in the fourth quarter of this year. Xu Changtai, Chief Market Strategist for the Asia-Pacific region at JP Morgan Asset Management, stated that the Federal Reserve is not in a hurry to cut rates as long as economic performance remains stable and inflation slows down due to rising oil prices. ## Ceasefire in the Middle East Favorable for Fed Rate Cuts Xu Changtai pointed out that if the Middle East conflict ceases this quarter, oil prices may fall to between $80 and $90 per barrel, which could lead the Federal Reserve to believe that inflation is only temporary. He believes that the situation in the Middle East has the most significant impact on the performance of US stocks in the second quarter. If the situation remains unstable, oil prices could surge to $120 or even $150, dragging down stock valuations and investment sentiment. The second influencing factor is the macroeconomy, along with several AI large model companies going public in the US, which may help boost market sentiment. ## If US-Iran Negotiations Continue, Oil Prices Stabilize at $100 If US-Iran negotiations continue, he personally believes that oil prices hovering around $100 would be a normal level, and the Hang Seng Index has room to rebound to 27,000 points. He hopes to see significant foreign capital inflow into the Hong Kong stock market this year, which has been lacking in local momentum in recent years. He is concerned whether overseas investors will consider allocating to the mainland and Hong Kong stock markets after the Middle East conflict to enhance the stability of their asset allocation and view mainland and Hong Kong companies as good investments. ## Foreign Capital Has Digested Issues of Domestic Real Estate and Unemployment He mentioned that China's economic growth target of 4.5% is not low, with the main issues being the domestic real estate market and insufficient labor market, which cannot be solved by simple stimulus policies but require time. Additionally, overseas investors have already digested these two issues and are currently more focused on the profitability of Chinese enterprises, the mainland government's AI policies, and actions against involution ### Related Stocks - [00HSI.HK](https://longbridge.com/en/quote/00HSI.HK.md) - [513600.CN](https://longbridge.com/en/quote/513600.CN.md) - [02800.HK](https://longbridge.com/en/quote/02800.HK.md) - [03037.HK](https://longbridge.com/en/quote/03037.HK.md) - [513130.CN](https://longbridge.com/en/quote/513130.CN.md) - [83115.HK](https://longbridge.com/en/quote/83115.HK.md) - [159740.CN](https://longbridge.com/en/quote/159740.CN.md) - [159920.CN](https://longbridge.com/en/quote/159920.CN.md) - [513180.CN](https://longbridge.com/en/quote/513180.CN.md) - [520920.CN](https://longbridge.com/en/quote/520920.CN.md) - [03032.HK](https://longbridge.com/en/quote/03032.HK.md) - [159742.CN](https://longbridge.com/en/quote/159742.CN.md) ## Related News & Research - [Hong Kong economy showed resilience in first quarter of 2026, Paul Chan says](https://longbridge.com/en/news/281703217.md) - [Global banks scale back China rate-cut calls, see policy rate on hold this year](https://longbridge.com/en/news/282006580.md) - [Guangdong-HKGBA Returns to Profitability in 2025](https://longbridge.com/en/news/281116626.md) - [Hong Kong retail sales jump nearly 12% in first 2 months of year](https://longbridge.com/en/news/281346585.md) - [China's factory activity expands but price pressures intensify, private PMI shows](https://longbridge.com/en/news/281282781.md)