[ET Net News Agency, 21 July 2025] Tech stocks surged at the open this morning,
propelling the HSI to immediately break this year's high and then push through the 25000
mark for the first time in three and a half years. However, profit-taking quickly emerged,
narrowing gains throughout the session. At midday, the HSI was up 69 points or 0.3 percent
at 24,895, with main board turnover exceeding HKD 151.4 billion and southbound net inflow
at HKD 3.6 billion. The Hang Seng China Enterprises Index stood at 8,999, up 12 points or
0.1 percent. The Hang Seng Tech Index closed at 5,556, up 17 points or 0.3 percent.

"Jaseper Tsang: If HSI holds above 25000, a further gain of at least 2000 points is
likely"

The HSI broke through the 25000 level in early trading, but lacked follow-through at the
highs, fluctuating around 24,900. Jaseper Tsang, the investment director of Rafter
Capital, told ET Net News Agency that, in the absence of long-term foreign capital, it
will be difficult for the HSI to hold above 25000 in the short term. He noted that Hong
Kong stocks have shown a pattern of choppy advances recently, but gains have not been
broad-based, with heavyweight stocks taking turns leading the rally. At present, the rise
in Hong Kong stocks is mainly supported by southbound capital and hedge funds, but lacks
the most crucial long-term foreign capital. Only when long-term foreign funds actively
enter the market will the HSI be able to firmly establish itself above 25000, with initial
support near the middle of the Bollinger band at around 24,300. Jaseper Tsang pointed out
that if the HSI can hold above 25000, it could see a further gain of at least 2000 points.

"Price war unlikely to end unless JD.com exits the food delivery market"

On the evening of 18 Jul, the State Administration for Market Regulation announced that
it had held talks that day with Ele.me, Meituan (03690), and JD.com (09618), requiring
these platforms to strictly comply with the E-Commerce Law, Anti-Unfair Competition Law,
and Food Safety Law. Platforms were also urged to fulfil their primary responsibilities,
further regulate promotional activities, participate rationally in competition, and
jointly build a healthy ecosystem for consumers, merchants, delivery riders, and platform
enterprises, promoting the steady and healthy development of the catering services
industry.
The authorities have stepped in to address excessive competition within the sector,
which boosted food delivery platform shares in early trading. However, Jaseper Tsang
believes such intervention will only have a short-term speculative effect on the stocks.
He pointed out that the core issue in the food delivery market is oversupply, with no room
for more companies to carve out market share. Administrative measures to restrict price
competition only address the symptoms, not the root cause. Unless JD.com is forced out by
regulatory action or chooses to exit on its own, the competitive landscape will only
worsen. He said market competition is always a winner-takes-all game, with platforms
slashing prices to seize market share, even at their own expense, forcing weaker rivals to
withdraw. Therefore, it is not yet the time for investors to consider buying food delivery
platform stocks.
Jaseper Tsang added that Meituan's technical trend remains weak, still trading within
the downward channel that began from the Mar high of HKD 189.6. The near-term resistance
is at the top of the downward channel, at HKD 136.
He said that for investors who favour large tech stocks, Tencent (00700) is worth
considering. Although it faces short-term negative pressure from South African
shareholders reducing their stake, its fundamentals remain strong. He recommends waiting
for the share price to adjust to HKD 490 before buying, with a 12-month target price of
HKD 630.