[ET Net News Agency, 25 June 2025] Although the ceasefire between Israel and Iran still
faces some complications, it is expected not to hinder the overall progress. Meanwhile,
Federal Reserve Chair Jerome Powell, in his appearance before the House of Representatives
on Tuesday, stated that there is no urgency to cut rates but did not rule out the
possibility of a rate cut in July. US equities moved higher, and the HSI maintained its
upward momentum after breaking through the 24,000 level. At midday, the HSI stood at
24,362, up 185 points or 0.8 percent, approaching the 11 Jun high of 24,400 during the
session. Main board turnover exceeded HKD 129.9 billion. The Hang Seng China Enterprises
Index was at 8,820, up 59 points or 0.7 percent. The Hang Seng Tech Index stood at 5,340,
up 42 points or 0.8 percent.

"Nip Chun Pong: HSI needs turnover to challenge highs"

With tensions in the Middle East easing and overseas markets performing well, Hong Kong
stocks have risen for four consecutive days. The HSI opened 150 points higher this morning
and was up as much as 251 points at its intraday peak of 24,428, close to the 11 Jun high
of 24,439. Nip Chun Pong, the Chief Strategist at Blackwell Global Securities, told ET Net
News Agency that as the Israel-Iran conflict has eased, global market sentiment has
improved, supporting continued gains in Hong Kong stocks. However, HSI's upward movement
also needs to be matched by strong turnover. The HSI rose 487 points yesterday on turnover
of HKD 240 billion. If the rally continues today and tomorrow, and turnover remains around
HKD 240 to 250 billion, the index could challenge this year's high of 24,874, or even
25,000, in July. Nip noted that in March, the HSI closed above 24,000 on six trading days,
with turnover around HKD 300 billion. Therefore, whether the current rally can be
sustained depends largely on the level of turnover.
Nip added that after four consecutive days of gains, with the HSI rising as much as
1,191 points, some investors may decide to take profits. In the short term, the index may
consolidate at higher levels, and while further gains are possible, the pace is likely to
slow. Still, there are not many negative factors in the market at the moment, so any
pullback from the highs is not expected to be significant. In addition, the National
Development and Reform Commission recently stated that it will announce measures to
stabilise employment and the economy at the end of June, which should provide some support
for the HSI. Furthermore, Mainland China continues to introduce new policies to stimulate
consumption. The Ministry of Commerce recently organised a "New Energy Vehicle Consumption
Season" across thousands of counties and towns, fuelling a rally in new energy vehicle
stocks. Nip expects similar initiatives will continue to be rolled out, benefiting various
consumer sectors. Therefore, even if the market pulls back, support is likely around the
23,800 level.

"Property market recovery sees real estate stocks outperform; outperformance over the past
two months"

Financial Secretary Paul Chan recently noted that the local property market had already
adjusted by 28 percent from its historical peak in September 2021 to April this year. With
interest rates now stable and trending lower, mortgage rates have also fallen, and he
described the property market as having "stabilised" at current levels. Property stocks
performed strongly today, with Hang Lung PPT (00101) rising five percent, ranking among
the top three blue-chip gainers for much of the session. SHK PPT (00016) and Wharf REIC
(01997) both rose more than four percent at their highs. Debt-laden New World Dev (00017)
even surged as much as nine percent. Nip Chun Pong noted that although the HSI has
rebounded from post-tariff war lows over the past two months, the rebound in property
stocks has been even stronger. For example, SHK PPT and Wharf REIC have both risen about
44 percent from their April lows to today's highs, Henderson Land (00012) has gained
nearly 57 percent, while the HSI's maximum gain over the same period was only 27 percent.
As for the strong performance of property stocks, Nip believes it is mainly due to a
recovery in the property market, driven by a wealth effect from the buoyant stock market.
In addition, since the government removed cooling measures last year and introduced the
Top Talent Pass Scheme, there has been pent-up purchasing power in the market.
Expectations of future rate cuts have also improved sentiment in the property market. Nip
said the chance of a Federal Reserve rate cut in July is not high, as the Fed has stressed
the need to observe inflation data for a longer period, and with only one more inflation
reading before July, a decision is unlikely before more data is available. However, the
overall trend for US interest rates remains downward, fuelling expectations and driving
property stocks higher. Recent bullish calls from major brokers have also helped, with
Bank of America favouring landlords such as Hysan (00014) and Wharf REIC. Among property
stocks, Nip believes CK Asset (01113) also deserves attention. The stock has only risen
about 33 percent over the past two months, suggesting it has potential to catch up.