[ET Net News Agency, 26 September 2025] US markets fell for a third consecutive session
overnight, with all three major indices closing lower. The HSI opened more than 200 points
down, but heavyweight Alibaba (09988) reversed early losses and helped narrow the decline
to just 109 points at one stage. However, with A-shares on the Mainland China remaining
weak and Alibaba's momentum fading, the HSI ended the morning at 26,312, down 171 points
or 0.6 per cent. Main board turnover was close to HKD 165.5 billion. The Hang Seng China
Enterprises Index finished at 9,386, down 57 points or 0.6 per cent, while The Hang Seng
Tech Index fell 66 points or 1 per cent to 6,312.

"Nip Chun Pong: Still range-bound, 20-day moving average offers support"

Impacted by US President Trump's newly announced tariff measures, the HSI opened 212
points lower this morning, at one stage dropping to 26,195 before narrowing losses to
under 200 points by midday. Nip Chun Pong, the Chief Strategist at Blackwell Global
Securities, told ET Net News Agency that pressure on resource stocks overseas weighed on
US markets overnight, and with a lack of positive news for Hong Kong equities, market
confidence has softened. After a technical rebound on Wednesday, 24 September, the HSI
remains range-bound for now. While further downside is possible, Nip believes the 26,000
level offers strong support and is unlikely to be breached in the short term, with the
20-day moving average at around 26,100 also providing a cushion.

"Tariff-driven pullback in pharma stocks seen as limited, much already priced in since
August"

On Thursday (25th), US President Trump announced a new round of tariffs targeting a wide
range of imported goods: from 1 October, the US will impose a 100% tariff on imported
pharmaceuticals, 25% on heavy trucks, and 50% on kitchen cabinets.
Nip noted that pharma stocks had been rallying for more than three months on the
"overseas expansion" theme since June, leading to some profit-taking pressure. The latest
pullback on negative tariff news has so far been mild. He pointed out that many pharma
names had already started to correct since late August, with Akeso (09926) falling 8% on
27 August, suggesting much of the downside was already priced in by the time the tariffs
were announced. For those stocks which corrected earlier on tariff concerns, current
valuation pressure is relatively limited.
However, Nip flagged that Innovent Bio (01801) has remained relatively strong and may
face greater pressure for further adjustment. He also highlighted RemeGen (09995),
Tigermed (03347), and BeiGene (06160) as more exposed to tariff risk, but these names had
also come under pressure since August, so the scope for further sharp declines appears
limited. Overall, he believes the tariff news is unlikely to trigger a significant
sell-off in the pharma sector at this stage.

"US-based production unlikely for Chinese pharma; China-US negotiations will be key"

Trump stated that the new 100% tariffs on any brand name or patented drug would apply to
all imported pharmaceuticals unless the manufacturer has already started building a
production facility in the US. "Under construction" means ground has already been broken
or work is underway; if a pharmaceutical company has started construction, those drugs
will not face tariffs.
Nip said it is unlikely that Chinese pharma manufacturers will set up production
facilities in the US and the sector will be watching how the policy develops, whether the
tariffs will be fully implemented, and whether companies will be forced to exit the US
market. For now, he expects companies to adopt a wait-and-see approach, especially as
further developments in China-US negotiations could change the outlook. There is also the
possibility of a summit between President Xi Jinping and Trump, which could influence the
situation. Over the next week or two, he expects pharma stocks to remain in a correction
phase, but once the rotation into tech stocks has run its course, the sector may see a
recovery.