[ET Net News Agency, 13 November 2024] Before the United States releasing October
inflation data today, U.S. bond interest rates continued to rise, and the three major U.S.
stock indexes fell back overnight. Hong Kong stocks had fallen for three consecutive days.
The Hang Seng Index fell another 125 points or 0.6% in half a day to 19,721. The main
board turnover exceeded HKD 104.1 billion. The Hang Seng China Enterprises Index reported
at 7,087, down 39 points or 0.6%. The Hang Seng Technology Index reported at 4,403, down
53 points or 1.2%.

"Nip Chun Pong: the stimulus effect of the Central Economic Work Conference is expected to
be limited"

Hong Kong stocks continue to be weak. The Hang Seng Index opened lower than 100 points
this morning and maintained a narrow range in the early stage. The fluctuation range is
currently less than 200 points. Nip Chun Pong, the Chief Strategist at Blackwell Global
Securities, told ET Net News Agency that after the 12th meeting of the National People's
Congress last Friday (8th), it was announced that the local government debt limit would be
increased by RMB 6 trillion to replace the existing hidden debt. This is a gap between the
scale and purpose of the 10 trillion in economic support expected by the market, resulting
in a significant weakening of the stock markets in China and Hong Kong. In addition, the
RMB has started to weaken since Trump came to power. The market expects that the weakness
will continue in the short term, and there is a chance that it will reach RMB 7.3 per US
dollar by the end of the year.
Under this general environment, the rising momentum of Hong Kong stocks is expected to
be relatively weak. Nip Chun Pong expects the Hang Seng Index to fluctuate between 19,500
and 20,100 points in the short term. This Friday (15th) there will be a number of
important data released in the Mainland China, including October fixed asset investment,
industrial production, retail sales data, etc. If the data beats expectations, the Hang
Seng Index will have a chance to rise above 20,100 points.
As for whether the Central Economic Work Conference that the market is looking forward
to will release more rescue measures, Nip Chun Pong pointed out that the results of recent
central economic work conferences are generally based on guiding national policies, and
they are usually not implemented until 2 to 3 days after the conference. It is expected to
have a small impact on the financial market, unless there is a specific bailout amount,
supported industries, specific time, etc.

"The acquisition news is negative and it is expected that it will be difficult to bring in
profits in the short term"

Geely Automobile (00175) fell as much as 7% today. It is rumoured that parent company
Geely Holding Group has entered into in-depth negotiations to acquire a controlling stake
in German air taxi startup Volocopter Gmbh. It is reported that Geely aims to complete due
diligence next month.
According to reports, Geely has discussed acquiring a majority stake in Volocopter by
leading a consortium to inject capital into the company. The size of this round of
financing is approximately USD95 million, in exchange for approximately 85% ownership; the
family office of German industrialist Gerhard Sturm will also participate in this
transaction. Geely and Sturm's office declined to comment.
Nip Chun Pong believes that Geely Holding's acquisition of Volocopter is negative news.
The initial stage of the acquisition is an investment period and is not expected to bring
positive profits to the group. Instead, it needs to invest funds. As for Geely's reduction
of its stake in Swedish Volvo Cars, the group has strongly denied it. Geely's stock price
fell sharply today, mainly because its results are about to be announced. The market does
not expect its third-quarter results to bring surprises. In addition, the stock's previous
cumulative gains have been considerable, and profit-taking may occur.
Geely's stock price fell as low as HKD 13.28 this morning, which is exactly the same as
the low on 1 November. Nip Chun Pong expects the stock price to have some support at this
level; the stock price has generally fluctuated between HKD 13.5 and 15.5 recently. If it
is below HKD 13.5, it can be considered for short speculation. However, there is
considerable resistance above the stock price near HKD 15, and investors should consider
before buying.