Morgan Stanley on Wednesday revised its outlook for select Asian equities, upgrading shipping and industrial names while downgrading a major Australian bank.
The investment bank maintained an underweight rating on National Australia Bank (NAB.AX), citing stretched valuation multiples against an uncertain operating environment and weak earnings outlook. Morgan Stanley noted that NAB’s recent stock gains in July were difficult to justify given current trading levels.
In contrast, Morgan Stanley assigned an overweight rating to COSCO SHIPPING Energy Transportation (1138.HK), departing from the consensus view that 2026 would mark the peak of the tanker cycle. The bank argued that 2027 could outperform 2026 due to expected delays in the reopening of the Strait of Hormuz. For the second quarter, the company reported a 24% year-over-year revenue increase to CNY 6.13 billion and a 46% rise in net income to CNY 1.83 billion.
Morgan Stanley also upgraded Mitsubishi Heavy Industries (7011.T) to overweight, raising its profit forecasts and price target after the company posted strong first-quarter results. The upgrade followed sustained earnings growth and margin improvement, particularly in the energy segment. The company also secured a JPY 378 billion defense contract with Japan’s Ministry of Defense for next-generation missile systems development and production.
