[ET Net News Agency, 23 June 2025] The US military has intervened in the Israel-Iran
conflict, bombing Iranian nuclear facilities last Saturday. Iran has vowed not to abandon
its nuclear programme. Tensions in the Middle East continue to escalate. The HSI opened
195 points lower and came under pressure in early trading, with losses at one point
widening to 258 points. However, A-shares reversed higher during the session, and the HSI
followed suit, briefly turning positive. At midday, the HSI stood at 23,498, down 31
points or 0.1 percent, with main board turnover exceeding HKD 108.2 billion. The Hang Seng
China Enterprises Index was at 8,517, down 9 points or 0.1 percent. The Hang Seng Tech
Index was at 5,133, down less than 1 point.

"Kwok Ka Yiu: Hong Kong stocks remain resilient, HSI expected to range between 23,000 and
24,000"

The White House announced attacks on three key Iranian nuclear facilities, marking the
formal involvement of the US military in strikes against Iran. There are reports that the
Iranian parliament has approved a blockade of the Strait of Hormuz as retaliation, pending
approval from the relevant authorities. US Secretary of State Rubio said blocking the
strait would be "economic suicide", urged China to put pressure on Iran to avoid further
escalation, and reiterated the US position on nuclear talks.
US equity index futures came under pressure in early trading, and the Hong Kong market
opened over 200 points lower. However, the market subsequently rebounded, with the HSI
even briefly turning positive and reaching as high as 23,600. Kwok Ka Yiu, the Director of
Business Development at Harbour Family Office, told ET Net News Agency that global markets
have not reacted too strongly to the US strikes, as the market generally expects Iran will
refrain from a strong response. After all, a major Iranian counterattack would not be in
the interests of its regional allies, making it difficult for other countries in the
region to support Iran. As a result, Israel and the United States are seen as having the
upper hand.
Therefore, Hong Kong stocks have also demonstrated resilience this morning. Kwok Ka Yiu
expects the market to remain firm for now, with the HSI likely to fluctuate between 23,000
and 24,000. He noted that leading tech and auto stocks have been under pressure from
intense domestic competition, prompting funds to rotate into other themes such as
stablecoin and high-dividend stocks, which are expected to benefit from the rate cut
environment in Mainland China.

"Li Ning's share increases yet to boost share price, acquisitions like Anta would be
positive"

Li Ning (02331) has recently been increasing its holdings, with the Li Ning family most
recently acquiring 6.4 million shares off-market last Thursday (19 Apr) at an average
price of HKD 14.96 per share, involving HKD 95.73 million. This raised their stake from
11.34 percent to 11.59 percent, marking the fifth such increase in about a week. Kwok Ka
Yiu said this is a positive signal, but the share price has yet to reflect any significant
benefit. He believes the market remains cautious on Li Ning's fundamentals, which are
closely tied to the economic environment, and the company has not shown the ability to
outperform on its own. Its international expansion strategy is key, but there have been no
developments so far, so Li Ning's share price is likely to move in line with the broader
market for now.
Unlike rival Anta (02020), which has pursued a multi-brand strategy, Li Ning has focused
mainly on its own brand. Kwok Ka Yiu does not rule out the possibility that Li Ning may
follow Anta's example and pursue acquisitions or integration to enhance its
competitiveness. Should such moves materialise, the market would have grounds to re-rate
Li Ning, but this remains to be seen. In terms of the share price, he pointed out that
there is clear support between HKD 14 and HKD 15. In the short term, it should not be
difficult to test HKD 17 or HKD 18, but these are expected to be more for short-term
trading opportunities.