[ET Net News Agency, 25 August 2025] Hong Kong stocks rallied following a strong start
in line with Wall Street, led by Mainland China property, tech, and metals sectors. HSBC
(00005) hit a record high of HKD 102.1, helping the HSI close the morning at 25,866, up
527 points or 2.0 per cent, on active turnover of nearly HKD 225.8 billion. HKEX (00388)
also advanced 3.4 per cent. However, there was a net southbound outflow of HKD 900 million
via Stock Connect. The latest HSI constituent review saw JD Logistics (02618) surge 7.6
per cent, while Pop Mart (09992) and China Telecom (00728) each gained around 1 per cent.

"Kwok Ka Yiu: improved risk appetite drives HSI towards 26,000; watch for China-US tariff
talks as a potential catalyst for pullbacks"

At the Jackson Hole global central bank symposium, Fed Chair Jerome Powell finally
struck a dovish tone, noting that US economic momentum is slowing and the labour market is
softening, saying that policy may "need to be adjusted", seen as one of the clearest
signals yet that the Fed is preparing to ease policy. Global equities surged in response.
Hong Kong stocks opened more than 200 points higher and extended gains, with the HSI
rising over 500 points in the morning to a high of 25,918, approaching the 26,000 mark.
Kwok Ka Yiu, the Director of Business Development at Harbour Family Office, told ET Net
News Agency that heightened rate-cut expectations have lifted overall sentiment in
financial markets. The rally in US equities last Friday, together with a weaker US dollar,
is favourable for capital returning to Hong Kong stocks, and he expects the HSI to move
towards 26,000.
Kwok also noted that strong performance in A-shares has boosted risk appetite, with the
Shanghai Composite climbing to the 3,850 level, a sign of improving sentiment in both
Mainland China and Hong Kong markets. He remains cautiously optimistic for the near term
but cautions that ongoing China-US tariff negotiations could be a source of volatility,
especially if any unexpected developments arise.

"Among local property stocks, focus on Sino Land and CK Asset; For Mainland China
developers, favour property management shares"

Rate-cut expectations have fuelled hopes of easing debt pressure for developers and
increased property demand, sending local and Mainland China property stocks higher,
particularly among highly leveraged names. Kwok acknowledged that, in theory, rate cuts
are positive for property developers, but both local and Mainland China property stocks
still face high inventory levels. Whether those with heavy debt loads can accelerate
destocking in a rate-cut cycle remains to be seen, so investors should not be overly
optimistic about the most leveraged names.
Instead, Kwok prefers developers with ample land reserves who have been accumulating
land during the market downturn, such as Sino Land (00083) and CK Asset (01113), as they
stand to benefit from lower costs once the market recovers. He is less optimistic about
Mainland China developers, with many still issuing profit warnings and facing balance
sheet pressures; he believes they will need more time to resolve their debts. In contrast,
he is more positive on property management stocks, which have reported strong results and
maintained dividends, making them more attractive than developers in the current
environment.

"Pop Mart's HKD 400 target no longer a dream; Stock Connect changes not surprising"

Last Friday (22nd), Hang Seng Indexes Company announced its quarterly review, adding Pop
Mart (09992), JD Logistics (02618), and China Telecom (00728) to the HSI, increasing the
number of constituents from 85 to 88. Pop Mart, long tipped as a likely blue-chip
addition, was finally included with a relatively high weighting of 1.44 per cent; its
share price rose more than 1 per cent in the morning, hitting a new high of HKD 331. Kwok
noted that Pop Mart's interim results remain strong, with the company actively
diversifying its business and revenue streams. He expects the stock to continue breaking
new highs after a period of consolidation, with the HKD 400 target in sight.
The company also adjusted the Hang Seng Composite Index, which is used for Stock Connect
eligibility, adding 24 stocks and removing 22, bringing the total from 502 to 504. Kwok
pointed out that with the HSI's strong gains so far this year, many stocks have now met
Stock Connect criteria, so the larger number of changes is not surprising. Stocks added to
the list should benefit from short-term southbound flows, but he cautioned that
longer-term performance will still depend on fundamentals, and investors should temper
their expectations.