[ET Net News Agency, 30 October 2025] The US Federal Reserve cut rates by 25 basis
points as expected, but expectations for a further cut in December have cooled, sending
the US dollar higher while US equities posted mixed results. In Hong Kong, the market
awaited the outcome of the Xi-Trump summit, which concluded after 1 hour and 40 minutes,
with details of the negotiations still unknown. By midday, the Hang Seng Index stood at
26,488, up 142 points or 0.5%, with main board turnover reaching HKD 178.7 billion. The
Hang Seng China Enterprises Index was at 9,425, up 49 points or 0.5%. The Hang Seng Tech
Index was at 6,112, up 18 points or 0.3%.

"Mak Ka Ka: Powell's comments aimed at managing expectations, December rate cut still
possible"

This morning, the Chinese and US presidents met in Busan, South Korea. The HSI opened
higher and traded in a narrow range. Mak Ka Ka, Head of Financial Products Trading and
Research Department of SinoPac Securities (Asia), told ET Net News Agency that the market
broadly expects the Xi-Trump summit to bring some easing of China-US tensions. The talks
are likely to focus on postponing reciprocal tariffs, purchases of US agricultural
products, China relaxing rare earth export restrictions, fentanyl, and the TikTok issue.
Meanwhile, the Fed's 25 basis point rate cut was in line with expectations, and it also
announced the end of quantitative tightening starting December. However, Chair Powell said
a December rate cut is not a given. Mak believes Powell's reluctance to commit to a
December cut is mainly to recalibrate market expectations, and a rate cut next month
remains possible. As for ending quantitative tightening, she expects this will improve
market liquidity and support medium- to long-term fund flows into Hong Kong stocks.
In terms of the HSI's technical outlook, Mak expects short-term resistance at the 27,000
level.

"Caution on HSBC: local property risks and Madoff compensation, maintain neutral rating"

HSBC (00005) reported results on Tuesday (28th), with the share price extending its
post-results rally for a second day, up a cumulative 6.3%. Q3 statutory pre-tax profit
fell 14% year-on-year to about USD 7.3 billion, missing expectations, while revenue rose
5% to USD 17.8 billion, beating forecasts. The quarterly dividend was maintained at 10 US
cents. The group raised its full-year net interest income guidance to USD 43 billion
(previously c. USD 42 billion), and expects a return on tangible equity (RoTE) of around
15% this year. However, Q3 operating expenses rose to USD 10.1 billion, including a USD
1.1 billion provision for the Madoff case.
Mak said HSBC's overall results were solid, with strong growth in wealth management and
net interest income, as well as improved rate risk hedging, all supporting the share
price. However, looking to the medium to long term, investors should remain alert to local
property market risks, compensation related to the Madoff case, and potential capital
pressure from the privatisation of Hang Seng Bank. As such, she maintains a neutral rating
on HSBC.
Nevertheless, Mak pointed out that HSBC's attractive dividend yield remains a draw,
especially in the current rate-cutting cycle, which favours higher-yielding stocks and
provides share price support. Defensive or conservative investors can continue to hold the
stock. For those not currently invested, she recommends waiting for a pullback towards HKD
105 before buying, with the medium-term target to break above the previous high of HKD
112.2.