China's Banking Stocks May Outperform This Month, Shenyin & Wanguo Says

China’s banking stocks may outperform the market this month because of recovering net interest margins, low valuations, and amid easing concerns that loans to local government-financing vehicles will turn bad, according to Shenyin & Wanguo Securities Co.

China Merchants Bank Co. and Industrial Bank Co. are the brokerage’s top picks for banks, analysts led by Li Yamin wrote in a report today. Property stocks may underperform the market as rising real-estate prices spur policy risks, according to the report.

To contact the reporter on this story: Bloomberg News in Shanghai at szhang5@bloomberg.net

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