Prudential shares rise 4% as UBS says worst-case China risks already priced in

Prudential's shares increased by 4% after UBS stated that the insurer's recent sell-off reflects a worst-case scenario regarding Chinese money flow restrictions into Hong Kong insurance products. The stock had fallen about 19% since new Chinese regulatory measures were announced in late May. UBS estimates that around 17% of Prudential’s new business profit comes from mainland Chinese customers buying Hong Kong savings policies and modeled a scenario where this business disappears entirely. Despite this, UBS believes the extreme downside risk is already priced in and maintains a 'buy' rating with a 1,470p price target, suggesting significant upside potential if regulatory clarity improves.