JP Morgan published a research report, indicating its preference order for Chinese financial stocks as brokerage stocks (core stocks), insurance stocks, and domestic bank stocks. In the brokerage sector, the bank sees structural drivers for earnings per share growth and return on equity (ROE) expansion, expecting that Chinese brokerages will achieve approximately 30% year-on-year growth in earnings per share for the fiscal year 2026, pushing the average ROE to about 10%. The bank's top picks among brokerage stocks are CICC and CITIC Securities A-shares. In the insurance sector, the bank believes that the stock market rebound, strong growth in intrinsic value driven by bank (core stocks) insurance channels, and attractive risk-return ratios provide an ideal re-entry point for the sector, with top picks including China Life and Ping An. The bank holds a relatively cautious attitude towards domestic bank stocks, expecting limited positive catalysts for the second quarter's performance, and the National Audit Office's report suggests potential earnings headwinds; easing geopolitical risks may lead to a rotation of funds out of H-shares in domestic banks. Among state-owned large banks, the bank is more optimistic about China Construction Bank in the short term, while it is more optimistic about Bank of China in the medium term.

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