[ET Net News Agency, 03 March 2025] After two days of declines, buoyed by positive
external factors and the upcoming Two Sessions, Hong Kong stocks rebounded this morning,
with strong performance in the domestic demand sector driving the Hang Seng Index to break
through the 23,000 mark. It reported a half-day figure of 23,218, up 277 points or 1.2%,
with a turnover exceeding HKD 179.6 billion. The Hang Seng China Enterprises Index stood
at 8,513, up 96 points or 1.1%. The Hang Seng Tech Index was at 5,605, up 37 points or
0.7%.

"Ryan Chan: Today's ten-day moving average is crucial; expectations for the Two Sessions
are optimistic"

Last Friday (28 February), U.S. markets focused on the lower-than-expected annual
increase in January's PCE data, with the cooling inflation boosting hopes for interest
rate cuts, leading to a significant rebound in U.S. stocks. Following a sharp decline last
Friday, Hong Kong stocks opened high this morning and rose by over 400 points at one
point. Ryan Chan, an executive director of Eddid Financial, told ET Net News Agency that
the Hang Seng Index had already shown signs of being overbought after several consecutive
rises, so a downward correction for a day or two is not surprising. He noted that since
February, the index had never closed below the ten-day moving average (currently around
23,201) until last Friday, when it first broke below. This morning, the index hovered near
the ten-day moving average, and whether it can close above this level today is crucial; if
it fails to stabilise, it may need to look down towards the twenty-day moving average.
The Mainland China's Two Sessions will commence tomorrow. Ryan Chan pointed out that
while the market is currently in an adjustment phase, there are expectations that the Two
Sessions may introduce supportive measures for AI, private enterprises, and real estate.
However, higher expectations also lead to greater disappointment. Nonetheless, recent
market conditions have been leaning positive, and the optimistic atmosphere makes it
easier to interpret news positively, allowing for expectations of a policy-driven market.

"New World concerns reduce, short-term speculation can be considered, but the real estate
sector remains challenged"

New World Dev (00017) reported a mid-term loss of HKD 6.633 billion, but its core
operating profit only fell 18% year-on-year to HKD 4.416 billion, with property
development revenue in Hong Kong rising 39% to HKD 1.734 billion. The results spurred the
stock price to jump over 15% this morning, reaching a high of HKD 5.62. Ryan Chan
acknowledged that New World's results were not bad. The company had previously faced
bankruptcy concerns due to high debt, but this performance alleviated some of those
worries, showing that the company is managing to recover funds better than previously
feared. With improved conditions in the real estate market and New World's sales
situation, market concerns have diminished significantly, leading to today's price
increase. He believes that after this performance, it should not be too difficult for New
World to repair the hundred-day moving average (HKD 6.073) in the short term, and a small
base around HKD 4 has already formed, indicating a decent trend.
However, Ryan Chan stressed that New World's debt reduction journey is still long, and
since real estate stocks are generally weak, any negative news could trigger significant
declines. Therefore, from an investment perspective, he would not recommend holding them
long-term and suggests short- to medium-term trading instead. He mentioned that the local
real estate market has entered a consumer-led phase, making it unlikely for prices to
significantly drop or rise, with no major catalysts expected to stimulate stock prices.

"Mixue should be sold; profit margin expansion is limited"

Mixue Group (02097), known as the "Frozen Capital King," had a strong debut this morning
as expected, with its public offering oversubscribed by 5,257.21 times, triggering a
mechanism that increased the number of shares offered to 8.53 million, representing 50% of
the total shares available. A total of 4,597 applications for 853,000 shares only resulted
in an allocation of two lots per person, with an additional 2,807 individuals receiving
one extra lot. The shares opened at HKD 262, 29.4% higher than the offer price of HKD
202.5, peaking at HKD 287.2 during the morning session, allowing a maximum profit of HKD
8,470 per lot, excluding fees.
Though it was difficult to obtain shares, Ryan Chan stated that those fortunate enough
to secure them should take profits immediately, as the triggering of the mechanism has led
to more retail investors receiving allocations, which could create significant selling
pressure on the stock price. In terms of fundamentals, while Mixue is one of the more
promising tea beverage stocks, intense industry competition makes Ryan Chan sceptical
about Mixue and the entire sector. He analysed that Mixue operates at the lower end of the
market, with low-priced drinks achieving high profit margins, indicating extremely low
costs. However, this also poses a barrier to entering the high-end market, leading him to
believe that limitations on margin expansion will hinder Mixue's future prospects.

"Bitcoin could soon reach new highs this season"

Additionally, after the cryptocurrency market experienced a pullback last week, Trump
announced yesterday that Bitcoin, Ethereum, Ripple, Solana, and Cardano would be
established as strategic reserves for the U.S., causing a sharp increase in the prices of
these five cryptocurrencies. This has also driven Hong Kong's Bitcoin ETF and Ethereum ETF
up by about 16% to 17%. Ryan Chan analysed that while the cryptocurrency market had
recently dipped due to risk aversion, the news of strategic reserve establishment
triggered a rebound in prices. He believes that Bitcoin may not be the most promising
cryptocurrency currently, but it is widely recognised by global investors, and the
short-term outlook is generally positive, with a good chance of reaching new all-time
highs this season or within the first half of the year.
However, he noted that the cryptocurrency market is still in a speculative phase, and
true price increases will only occur when cryptocurrencies can genuinely fulfil their
intended transactional purposes. He believes this is unlikely to happen in the short to
medium term, especially during Trump's term, as the market largely views cryptocurrencies
as assets rather than currencies, making it a long-term prospect.