Goldman Sachs has released a research report reducing its price target for Hong Kong Exchanges and Clearing Ltd (HKEX) by 1.7%, from HK$532 to HK$523, while maintaining a "Buy" rating.

The investment bank lowered its earnings per share forecasts for HKEX for fiscal years 2026 through 2029 by 1% to 2%, primarily reflecting the recent slowdown in market activity.

Goldman Sachs expects the company to report third-quarter earnings per share of HK$3.76, representing a 3% year-on-year decline, mainly due to lower average daily turnover and reduced investment income. HKEX is scheduled to announce its third-quarter results on November 6.

Goldman Sachs noted that average daily turnover fell 11% year-on-year to HK$254 billion, driven by weakness in technology stocks and a 30% drop in southbound trading volume. Meanwhile, the bank expects investment income to decline 23% quarter-on-quarter, mainly due to a reduction in margin financing scale.

Looking ahead, the bank believes investors may focus on the outlook for average daily turnover, potential trading hour extensions, and new gold market initiatives. Nevertheless, the bank pointed out that the IPO market remains strong, with 577 companies currently in the process of listing applications.