[ET Net News Agency, 26 February 2026] US stocks rose for a second consecutive day.
Although Nvidia's results were strong, its share price was volatile in after-hours
trading. Hong Kong stocks, now in the midst of earnings season, also showed choppy
performance. Early in the session, the HSI tracked the record highs of the two major Hong
Kong banks and started well, but technology and Mainland China insurance sectors
underperformed intraday. By midday, the Hang Seng Index had fallen 104 points or 0.4% to
26,661, with main board turnover exceeding HKD 130.9 billion. Stock Connect registered
another net outflow of nearly HKD 4.5 billion. The Hang Seng China Enterprises Index ended
the morning at 8,918, down 116 points or 1.3%. The Hang Seng Tech Index closed at 5,173,
down 86 points or 1.7%.

"Yuen Che Hay: Old tech stocks need earnings to regain confidence"

On option expiry day, Hong Kong stocks were volatile. The HSI opened over 200 points
higher in the morning but quickly fell back, at one stage dropping more than 200 points.
Yuen Che Hay, the Co-Director of Investment Strategy of Quam Asset Securities, told ET Net
News that Hong Kong stocks are currently in a position where it is hard for them to rise
but easy to fall. The biggest reason is concerns about earnings prospects for tech stocks.
He noted that "technology stocks" are now divided into "new tech stocks" and "old tech
stocks": names linked to AI, such as the "AI Dragons and Tigers", have much brighter
growth prospects and their recent share price gains have made the old tech stocks, such as
ATMX, look increasingly lacklustre. The main concern is that the new AI wave could erode
the profits of traditional tech companies; this has put pressure on old tech stocks' share
prices recently. Under this premise, the major tech stock heavyweights have struggled to
improve. To win back market favour, these old tech names must produce earnings that
rebuild investor confidence.
He expects the market will remain in a stock-picking mode while investors wait for tech
earnings, with the HSI likely to fluctuate between 26,000 and 27,000. Investors need to
pick stocks selectively rather than rely on the broad market, as no sector is completely
bullish or bearish now and each stock must be judged on its individual merits. He cited
traditional financial stocks as an example, only companies that post results well above
expectations, like HSBC (00005), can see their shares break out to new highs. For
large-cap blue chips such as Mainland China insurers, he considers them suitable for
holding, but for HKEX (00388), the technical picture warrants caution. Yuen added that
current conditions do not favour speculative trading; even "steady rebound" stocks such as
property and financials have already risen a lot, making it hard to buy on dips or chase
higher prices.

"Antitrust investigation becomes Trip.com's Sword of Damocles"

Trip.com (09961) announced its fourth quarter net profit doubled year-on-year to RMB
4.27 billion, although this represented a 78.5% quarter-on-quarter decline. Revenue grew
20% year-on-year to RMB 15.43 billion, with all key segments posting balanced year-on-year
growth of 10-20%. Yuen Che Hay commented that Trip.com's results were not only solid but
could even be described as strong. However, the antitrust investigation by the State
Administration for Market Regulation has offset all positive factors. He pointed out that
if the regulator eventually imposes a fine, the market might even breathe a sigh of
relief, as even a large fine would at least bring closure to the issue. Currently, though,
the investigation remains unresolved. Even Trip.com itself noted in its results that it is
unable to predict the status or outcome of the probe, further deepening uncertainty. Thus,
no matter how strong the earnings, it is hard to attract buyers. Yuen believes the
market's real concern is not the penalty itself, but uncertainty over what the company can
or cannot do in its business operations in future, and this is what truly deters
investors.
Since the launch of the antitrust probe, Trip.com's share price has slumped more than
30% from above 600 HKD to briefly fall below the psychological 400 HKD level. Yuen noted
that after a sharp drop, the risk-reward ratio for the stock is certainly higher, but the
real question is whether investors can benefit, when even the company isn't clear on the
investigation's status or eventual outcome. Even as the valuation becomes attractive, he
does not recommend investors rush in to bottom-fish. He added that, for now, the
authorities' investigation into Trip.com remains an isolated case. But if more cases
emerge, the market will begin to worry about a renewed wave of antitrust action.