[ET Net News Agency, 06 March 2025] US President Trump announced a one-month delay in
the imposition of tariffs on imported cars from Canada and Mexico. Market expectations for
further tariff exemptions, combined with worse-than-expected employment data leading to
rate cut anticipations, prompted a rebound in US stocks. Chinese concept stocks surged due
to multiple factors, driving the Hong Kong market to perform strongly this morning. The
Hang Seng Index opened at 23,987, nearing the 24,000 mark, and quickly expanded its gains
to over 500 points, reaching a high of 24,262, marking the highest level since February
2022. The index closed at 24,216, up 622 points or 2.6%, with a turnover of nearly HKD
216.8 billion.

"Ryan Chan: The Hang Seng Index's consolidation phase has come to an end, with a target of
25,000 points"

With the threat of tariffs easing, the atmosphere in the Hong Kong market has warmed.
After a strong opening, the Hang Seng Index continued to rise, breaking through the
previous high from 27 February. Ryan Chan, an executive director of Eddid Financial, told
ET Net News Agency that the current consolidation phase has concluded, with an overall
shift towards positive trends. The technology sector is providing ample upward momentum
for the index, which could aim for 25,000 points in the short term. The support level is
now at 24,000 points, which has turned from resistance to support.
Some analysts believe the current rise in the Hang Seng Index is driven by hopes that
China may receive similar tariff relaxations from the US as Canada and Mexico. There are
concerns that if these market hopes do not materialise, a correction in the index may
follow. Ryan Chan noted that while the index is rising today, the potential for adjustment
exists if future expectations fall short. However, he emphasised that tariff issues
primarily affect market sentiment and have little direct impact on major companies within
the index; rather, concerns should focus on US restrictions on Chinese tech firms.

"Results of Hong Kong Stock Connect adjustments to be announced next Monday, but
speculation is not advised"

Beike (02423) performed well, with the maximum gain in the morning session reaching 9%.
According to reports, a brokerage has stated that Beike has met the requirements to enter
the Stock Connect and is expected to be included on 10 March, aiding its valuation
recovery. The market suspects this rise may be speculative. Ryan Chan remarked that
Beike's fundamentals indeed qualify it for inclusion in the Stock Connect, but the current
increase may not solely be driven by speculation. He noted that Beike appears to be in an
upward flag pattern, indicating a strong trend. Moreover, Beike's uniqueness in the real
estate sector - offering comprehensive online property services rather than merely acting
as a developer, agency, or property management company - means it stands out in a market
where such companies are rare. As the real estate sector stabilises, the potential for
significant increases in such stocks is high, and Beike could surpass the previous peak of
HKD 73.5.
Some brokerages predict that 28 stocks may be included in the Stock Connect, including
CR Beverage (02460) and Mao Geping (01318). Ryan Chan indicated that these two stocks have
potential for inclusion. However, he advised investors against buying related stocks
solely based on speculation about their inclusion; rather, they should consider current
popular concepts when making decisions.

"Chinese concept stocks still have room to rise, with optimism for Tencent and Alibaba"

The previous night, the China Golden Dragon Index surged by 6.4%, boosting early trading
in various tech stocks. Ryan Chan stated that as foreign investors' views on the Mainland
China economy improve, capital is flowing back into related stocks, which is likely to
continue benefiting tech stocks. Among Chinese concept stocks, he is particularly
optimistic about Tencent (00700) and Alibaba (09988), believing that applications of
artificial intelligence will support their business and lead to higher valuations from the
market. He recommends buying Tencent at HKD 510 to 520 and Alibaba below HKD 140.