[ET Net News Agency, 21 January 2025] On Monday (20th), U.S. President Trump was
officially sworn in as the 47th President of the United States for his second term, taking
office at the White House. On his first day in office, Trump did not implement
comprehensive tariff measures, sparking optimism for a potential improvement in U.S.-China
relations and boosting the Hong Kong stock market. The Hang Seng Index reported 20,149 at
midday, climbing 223 points or 1.1%, marking the second consecutive day above the 20,000
mark, with a turnover exceeding HKD 87.1 billion. The Hang Seng China Enterprises Index
reported 7,331, up 95 points or 1.3%. The Hang Seng Tech Index reported 4,709, up 114
points or 2.5%.

"Nip Chun Pong: Market support awaits rate cuts and reserve requirement reductions in
Mainland China"

Trump took office at the White House last night without implementing comprehensive
tariff measures on his first day, leading to a more than 200-point surge in the Hong Kong
stock market. The market opened above the 20,000 mark and successfully held steady in the
morning. Nip Chun Pong, the Chief Strategist at Blackwell Global Securities, told ET Net
News Agency that the Hang Seng Index is currently in a wait-and-see atmosphere. Trump
signed multiple executive orders on his first day in office, and the market expects him to
be busy signing executive orders in the coming days, creating uncertainties in tariff
policies. Compared to the positive news released by a news release following the previous
phone call between the U.S. and Chinese presidents, a direct confirmation by Trump of
reaching consensus with China could further reassure the market. Whether the Hang Seng
Index can hold above the 20,000 mark still requires observation, and future support will
depend on favourable policies such as rate cuts and reserve requirement reductions in
Mainland China. Regarding support levels, Nip Chun Pong noted that the Hang Seng Index
showed an upward gap last Friday and this Monday, with initial support around the gap
bottom at 19,600 points.

"Performance of the three major oil companies depends on Mainland China's economic
performance"

Trump declared a national energy emergency to increase U.S. oil and natural gas
production, aiming to reduce costs for US consumers. New York crude oil dropped by USD
0.99 or 1.27%, closing at USD 76.89 per barrel. Brent crude oil fell by 0.8%, closing at
USD 80.15 per barrel.
Nip Chun Pong stated that initial support for New York crude oil is around USD 75, and
since 10 January, New York crude oil has mostly closed above USD 75. If Trump further
expands production, prices may further decline to find support around USD 70 to 72. The
movement of Brent crude oil is more significantly affected by developments in the
Russia-Ukraine conflict. In case of peace talks or ceasefire news, its downward momentum
may surpass that of New York crude oil. For now, attention is focused on the USD 77 level,
with the next support at USD 72 to 75.
Today, the three major oil companies are under pressure, but the declines are not
significant. For example, CNOOC (00883) dropped by 0.7% to close at HKD 18.94, while
PetroChina (00857) declined by 0.5% to close at HKD 6.09. Regarding investors holding
shares in the three major oil companies, Nip Chun Pong believes that the planned increase
in U.S. oil production is not the main reason for their declines, as their stock
performance is primarily influenced by Mainland China's economic performance. The GDP data
for the fourth quarter of last year and the performance of the three major industries
provided some support, but if economic data deteriorates in the future, there could be
more selling pressure on the oil companies. If the data continues to improve, the recent
decline could be a temporary adjustment, with a possibility of breaking new highs in
February.
He further pointed out that the three oil companies have been rising for some time,
funds are now shifting to technology stocks or blue-chip stocks, limiting short-term
upside potential. CNOOC's stock price today has dipped below HKD 18.5, suggesting an entry
point between HKD 18 and 18.5, with resistance at HKD 20; PetroChina may fall back to
around HKD 5.6, suggesting a buy-in near HKD 5.6, with resistance at HKD 6.5.