HUCSHEN@EC2611A(16864.HK)

Morning Trend Observation | CHINA SHENHUA (1088.HK) Continuous Volume Increase, Bullish Pattern Initially Established

On Tuesday morning, China Shenhua continued to strengthen with increasing volume. Benefiting from the rebound in commodity prices and the overall outstanding performance of energy stocks, risk-averse funds continued to flow in. Recently, international coal prices have risen, and various regions have entered a peak coal consumption period, driving the company's stock price to close above the five-day moving average, indicating a strengthening technical trend. Industry views suggest that the improvement in industrial prosperity, combined with policy support, has created a short-term window for the energy sector to catch up. From the market perspective, funds have repeatedly flowed back to coal leaders, with active turnover rates and buying power. The significant increase in trading volume is evidence of short-term main forces actively entering the market. Continuous breakthroughs of multiple moving averages and the strengthening of technical indicators such as MACD have warmed the bullish atmosphere within the sector. Due to the recent emphasis by the National Development and Reform Commission on coal supply security and the high dividend attributes of leading companies, institutional allocation dynamics have significantly improved. However, the risk to be wary of is the sustainability of funds and the follow-up of main forces remains uncertain. If there are large sell orders during the session or signs of a short-term high opening and retreat, it could exacerbate volatility. Affected by the upcoming holiday, market risk aversion may also fluctuate. In terms of operations, short-term attention can be paid to the dynamics of main forces and the breakthrough of pressure lines near previous highs, but blind chasing of price increases is not recommended. It is advised to continuously monitor changes in volume, policy direction, and signals from the industry fundamentals

The Hang Seng Index turned positive, with CHINA SHENHUA rising over 4% and CNOOC rising over 2%

China Shenhua Energy Granted Patent for Automatic Welding Machine Enhancing Shearer Spiral Drum Manufacturing

China Shenhua Energy Company Ltd. announced that its subsidiary, Shendong Coal, has received a national invention patent for an automatic welding machine for shearer spiral drums. This technology features intelligent sensing and adaptive control to improve manufacturing processes, addressing issues like welding deformation and gravity balance. The machine includes a feedback system for real-time adjustments and enhances product consistency and operational stability, marking progress in intelligent coal mining equipment.

China Shenhua setzt neue Steuerungstechnologie für sicheren Kohleabbau ein

China Shenhua Energy Company Ltd. has announced the successful implementation of an innovative technology for active control of rock pressure in mining. This numerical simulation-based method allows precise control of mining height, advance rate, and support systems even under challenging geological conditions. The digital approach has significantly reduced safety risks and improved efficiency in coal mining.

In "The Big Banks," China International Capital Corporation: China Shenhua's profit guidance last year slightly missed expectations, maintaining a "Hold" rating

BOC International released a research report stating that China Shenhua is expected to see a 6.3% year-on-year decline in net profit in 2025, dropping to between RMB 50.8 billion and RMB 55.8 billion, which is 0.6% to 9.5% lower than expected. Fourth-quarter earnings are expected to decline by 1.5% quarter-on-quarter to 35.6%. The main reasons are the increased costs in the coal business and changes in the sales mix, while the power business faces issues such as rising coal costs, falling electricity prices, and reduced utilization rates. The rating is maintained at "Hold," with a target price of HKD 42.5