"Market Review" Hong Kong stocks decline before the long holiday, Geely and Chery rise against the trend

U.S. President Trump stated in a television address this morning that there will be extremely severe strikes against Iran in the next two to three weeks. In June, Brent crude oil futures surged 7% to $108.27 per barrel, and Hong Kong stocks fell today. The market had previously anticipated a ceasefire between the U.S. and Iran, with the Dow Jones and Nasdaq rising 0.5% and 1.2% respectively overnight, but Trump's subsequent remarks diminished those hopes. At the time of writing, the yield on U.S. 2-year bonds rose to 3.852%, the yield on U.S. 10-year bonds rose to 4.378%, and the U.S. dollar index rose to 100.14. Dow futures are currently down 445 points or 0.95%, Nasdaq futures are down 363 points or 1.5%, the Shanghai Composite Index fell 29 points or 0.74% to close at 3,919 points, the Shenzhen Component Index fell 1.6%, and the ChiNext Index fell 2.3%, with a total trading volume of 1.84 trillion yuan in the Shanghai and Shenzhen markets.

Hong Kong stocks opened lower, with the Hang Seng Index down 39 points, and the decline expanded to 392 points in the afternoon, reaching 24,901 points. The decline slightly narrowed at the close, finishing down 177 points or 0.7% at 25,116 points; the National Index fell 47 points or 0.56% to close at 8,456 points; the Hang Seng Tech Index fell 77 points or 1.6% to close at 4,679 points. The total trading volume for the day was 243.628 billion yuan. The total trading volume for northbound trading was 115.155 billion yuan, while southbound funds saw a net inflow of 19.828 billion yuan today (after a net outflow of 12.694 billion yuan on the previous trading day).

Hong Kong stocks will be closed tomorrow (the 3rd) for the "Good Friday" holiday, with only four trading days this week. The Hang Seng Index has risen a total of 164 points or 0.7% this week, the National Index has risen a total of 3 points or 0.04% this week, and the Hang Seng Tech Index has fallen a total of 98 points or 2.1% this week, with southbound funds seeing a net inflow of 5.371 billion yuan this week. Hong Kong stocks will also be closed next Monday (the 6th) and next Tuesday (the 7th) for the "day after Qingming Festival" and "day after Easter Monday" holidays, with trading resuming next Wednesday (the 8th).

【Concerns over U.S.-Iran conflict, Hong Kong stocks fluctuate downwards】

Oil stocks performed well, with PetroChina (00857.HK) and CNOOC (00883.HK) rising 2.1% and 0.2% respectively throughout the day. Coal stocks Yancoal Energy (01171.HK) and China Coal (01898.HK) rose 3.1% and 3.7%. Gold mining stocks Zijin (02899.HK), Zijin Mining International (02259.HK), Lingbao (03330.HK), and China Gold International (02099.HK) fell between 3% and 4.3%. Resource stocks Jiangxi Copper (00358.HK), China Molybdenum (03993.HK), and Minmetals Resources (01208.HK) fell between 2.8% and 3.4%. Airline stocks China Southern Airlines (01055.HK), China Eastern Airlines (00670.HK), and Air China (00753.HK) fell between 3.8% and 4.9%.

AI stocks declined, with Zhizhu (02513.HK) and MiniMax (00100.HK) dropping 14.9% and 10.4% respectively throughout the day. Cloud service providers Kingsoft Cloud (03896.HK) and GDS Holdings (09698.HK) fell 3.8% and 3.7%.

【Over a thousand stocks fell, Geely rose against the trend】

Hong Kong stocks turned weak today, with the rise and fall ratio of main board stocks at 18 to 31, with 1,288 stocks falling (a decline of 2.7%); among the Hang Seng Index constituent stocks, 38 rose and 46 fell, with a rise and fall ratio of 42 to 51 Automobile stocks are mixed, with BYD (01211.HK) down 0.8% to HKD 103.9, and Xiaomi (01810.HK) down 3.6%. Chery (09973.HK) saw a 15% year-on-year increase in total sales for March, with its stock price rising 15.3% for the day. Chang'an Automobile (02333.HK) reported an 8% year-on-year growth in March sales, with its stock price increasing 7.3% for the day, while Geely (00175.HK) saw its stock price rise 8.4% to HKD 23.82, with a trading volume of HKD 4.37 billion, making it the blue-chip stock with the largest increase.

Morgan Stanley recently released a report stating that Geely Automobile's management attended the Chinese investor conference hosted by the firm, where the group reaffirmed its overseas sales target of 640,000 units by 2026, of which approximately 300,000 will be fuel vehicles. In the first quarter of this year, 180,000 units have already been completed, indicating good progress. The company stated that overseas capacity expansion will prioritize the use of existing factories to avoid large-scale new investments. The management also set a target for an average vehicle cost reduction of about RMB 7,000 to 8,000 to offset the pressure from rising memory and raw material prices. The company maintained good pricing discipline in the first quarter, significantly improving per-vehicle profitability, with profits per vehicle in overseas markets potentially reaching RMB 13,000 to 15,000, about three times that of the domestic market. Morgan Stanley maintains an "Overweight" rating on Geely with a target price of HKD 25