Hong Kong stocks are cheap but may miss out on the benefits of China's economic support, analysts at Goldman Sachs said, while Morgan Stanley warned tensions and tariffs could hurt, as both brokerages downgraded market forecasts.

Goldman Sachs predicts additional tariffs on China, but sees domestic challenges as the bigger issue. Read more here.

The top bosses from Goldman Sachs Group Inc. and Morgan Stanley called for greater transparency from China and for eased movement of capital to restore the appetite of global investors.

Goldman Sachs and Morgan Stanley downgraded their forecasts for Hong Kong and Chinese stocks, citing economic concerns and potential political impacts. While bullish on mainland China, Goldman Sachs believes Hong Kong will see limited growth and recommends mainland investments due to lower global sensitivity.