[ET Net News Agency, 24 June 2025] US President Trump announced that Israel and Iran
have agreed to a "comprehensive ceasefire". Alongside continued dovish comments from
Federal Reserve officials, Asia-Pacific stock markets broadly rose. The Shanghai Composite
Index broke through 3,400, and the HSI followed the positive trend, reclaiming the 24,000
level. At midday, the HSI stood at 24,150, up 461 points or 1.9 percent, with main board
turnover close to HKD 131.9 billion. The Hang Seng China Enterprises Index was at 8,762,
up 165 points or 1.9 percent. The Hang Seng Tech Index was at 5,305, up 118 points or 2.3
percent.

"Mak Ka Ka: HSI is expected to test 24,874"

After Iran launched a "symbolic" retaliation against the US base in Qatar, it promptly
accepted the US proposal for a comprehensive ceasefire agreement. US equities rallied
overnight, and Hong Kong stocks opened over 100 points higher, with gains widening
throughout the morning. The HSI not only regained the 24,000 mark but at one point rose
more than 500 points. Mak Ka Ka, Head of Financial Products Trading and Research
Department of SinoPac Securities (Asia), told ET Net News Agency that reduced geopolitical
risk has boosted market risk appetite. Against the backdrop of de-dollarisation, funds are
willing to flow into Hong Kong and A-shares, with today's rally notably led by Chinese
financial stocks. She expects Mainland China banks and insurers to continue attracting
funds given their high yields and low valuations, and believes they are worth monitoring
further.
Regarding the market outlook, Mak Ka Ka noted that corrections due to geopolitical
tensions are usually short-lived, and rebounds after such events tend to be swift and
strong. She expects the HSI to challenge the previous high of 24,874 in the short term.
She does not expect a major pullback ahead, but did highlight certain external
uncertainties: in addition to the possibility that Trump's "One Big Beautiful Act" Section
899 could raise tariffs, there is still uncertainty over whether the Federal Reserve will
cut rates in July. The inflation impact from the tariff war may not become apparent until
the third quarter, so the Fed may wish to observe more data before acting, possibly
pushing any rate cut back to September. If rate cuts do not materialise, this could affect
the market. However, the current consensus still expects two rate cuts this year, and the
bond market remains stable, so market conditions are also expected to remain relatively
stable.

"Baidu's autonomous driving technology still awaiting breakthrough, focus on Southeast
Asian expansion"

Tesla made headlines by launching its RoboTaxi autonomous taxi service in Austin, Texas.
The first batch of trial users will pay a fixed fee of USD 4.20, marking a major step
forward for the company in autonomous vehicles and sending its share price up more than 8
percent. Hong Kong-listed smart driving stocks performed well, but Baidu (09888), which
also operates the "Apollo Go" autonomous taxi service, saw a muted response, rising just
over 1 percent at midday. Mak Ka Ka noted that smart driving is a key national development
direction, and Tesla's news has raised industry expectations, but Chinese companies still
need further technological breakthroughs. With no clear timetable for domestic launches,
some concept stocks have responded sluggishly.
The market generally believes Baidu's "Apollo Go" still needs to prove its
profitability, but Mak Ka Ka pointed out that Apollo Go has recently been actively
expanding into Southeast Asia, seeking pilot programmes in Malaysia and Singapore. If
these launches succeed, it would improve the outlook for both Apollo Go and Baidu. She
acknowledged that Tesla's RoboTaxi introduces competition, but believes Apollo Go still
enjoys advantages in China and Southeast Asia, so it may not necessarily lose out in the
long run.
Other autonomous driving suppliers performed better than Baidu today, and Mak Ka Ka
believes now is a good time to deploy in this sector. She explained that related stocks
had previously pulled back, and as the broader market rebounded quickly, these laggards
could attract inflows. However, given fierce competition in the automotive sector, even
upstream suppliers should stick to leading names such as Horizon Robotics (09660) for
greater safety. Mak Ka Ka suggested a short-term target price of HKD 7.8 for Horizon
Robotics.