[ET Net News Agency, 17 October 2025] Overnight, US stocks fell across the board,
dragged down by news of bad debts at regional banks. Both Mainland China and Hong Kong
stock markets were similarly weak. The HSI opened slightly lower and continued to trend
downwards, dropping 415 points or 1.6 percent by midday to 25,472. Main board turnover was
close to HKD 15.32 billion. The Hang Seng China Enterprises Index was at 9,104, down 155
points or 1.7 percent. The Hang Seng Tech Index stood at 5,835, down 168 points or 2.8
percent.

"Kwok Ka Yiu: HSI to watch 25,000 support, financials to remain under pressure in the
short term"

According to foreign media, two US regional banks, Zions and Western Alliance, reported
bad debts or loan fraud issues. Both shares slumped, raising market concerns that a high
interest rate environment and sluggish business conditions may be starting to trigger
funding chain crises in the banking sector. This comes as First Brands and Tricolor
Holdings recently declared bankruptcy, further intensifying worries over a potential
credit crisis. Regional bank stocks in the US suffered heavy losses overnight, with the
Dow dropping more than 300 points. The HSI opened 36 points lower and continued to fall
throughout the morning. Kwok Ka Yiu, the Director of Business Development at Harbour
Family Office, told ET Net News Agency that while the US banking credit crisis has so far
had limited impact on Hong Kong equities, the focus is now on whether the broader economic
environment will worsen. If it does, the Federal Reserve may be forced to continue cutting
rates to support the economy.
He also pointed out that share performance is becoming more divergent. Given the high
correlation of tech stocks to the economic environment and their benefit from a low
interest rate environment, their impact is relatively limited. In contrast, financial
stocks are likely to face greater short-term pressure. He conceded that for Hong Kong
stocks, this could provide an excuse for selling. The ongoing China-US trade war remains a
major concern, and with significant gains already accumulated this year, some investors
are choosing to take profits early. For now, the key level to watch for the HSI is 25,000.
State-owned enterprises with low valuations and high dividends offer some support and are
relatively defensive.

"Gaming stocks offer investment value, non-gaming growth for Galaxy Entertainment
expected"

According to data from the Macao Gaming Inspection and Coordination Bureau, Macao's VIP
baccarat revenue in the third quarter rose 29 percent year-on-year to MOP 16.89 billion,
the highest level since Q4 2019. Mass market gaming revenue increased by 7.4 percent to
MOP 45.68 billion, while total gross gaming revenue rose 13 percent to MOP 62.57 billion.
VIP baccarat accounted for 27 percent of total gaming revenue, up from 24 percent a year
earlier.
Kwok Ka Yiu noted that Macao gaming stocks have performed well in the second half, with
improvements in both visitor numbers and spending data. There were earlier concerns that
typhoons in September might impact results, leading to some pullbacks in share prices.
However, at current levels, he believes Macao gaming stocks present investment value,
especially Galaxy Entertainment (00027) which has room for growth in its non-gaming
business. He added that gaming operators have shifted focus to premium mass and mass
market segments. While it is difficult to achieve the rapid growth seen in the past, the
premium mass business still offers considerable potential and remains attractive to
Mainland China consumers.

"IPO delay has limited impact, mainly technical"

Haixi Pharma (02637) announced yesterday that its IPO timetable will be postponed, as
extra time is needed to finalise the announcement containing the final offer price,
international placing subscription levels, Hong Kong public offering application status,
and basis of share allocation, as well as to obtain regulatory approval.
Mak Ka Ka, Head of Financial Products Trading and Research Department of SinoPac
Securities (Asia), told ET Net News Agency that IPO delays are rare and she believes this
is a technical issue, which is unlikely to have a significant impact on the stock.