[ET Net News Agency, 18 July 2025] US initial jobless claims for the latest week fell to 221,000, declining for a fifth consecutive week and reaching the lowest level since mid-Apr. In addition, after two months of decline, US retail sales in Jun rebounded by 0.6 percent month-on-month, exceeding the expected 0.1 percent rise. US stocks ended higher on Thursday after a volatile session, with all three major indices closing up. Strong performance in tech stocks led the HSI to open over 200 points higher, reaching 24,821 in early trading and once again approaching the Mar high. At midday, the HSI stood at 24,676, up 177 points or 0.7 percent, with main board turnover near HKD 136.1 billion. The Hang Seng China Enterprises Index was at 8,922, up 69 points or 0.8 percent. The Hang Seng Tech Index was at 5,490, up 41 points or 0.8 percent.
"Yuen Che Hay: Hong Kong stocks have breakout potential, but stability depends on results season"
The Hong Kong market continues to consolidate at high levels, with the HSI at one point rising more than 300 points this morning to approach the Mar peak of 24,874, before gains narrowed to over 150 points at midday. Yuen Che Hay, the Co-Director of Investment Strategy of Quam Asset Securities, told ET Net News Agency that although the HSI has recently only hovered at high levels, he remains confident that Hong Kong stocks will set new highs within the year. He pointed out that heavyweight tech stocks have lacked major news lately and have not driven the HSI higher, but capital activity remains strong, with investors frequently chasing non-heavyweight sectors such as pharmaceuticals, indicating that while the market is not fully betting on a broad rally, thematic trading sentiment remains very active.
Yuen Che Hay explained that although a China-US trade agreement has recently been reached, there are still no signs of a global economic upturn, leading to a wait-and-see attitude and range-bound trading at high levels. He is optimistic that as news becomes clearer, the HSI will have the chance to break through 24,874, with an initial breakout target of 25,200. However, he emphasised that whether the market can stabilise above 25,000 will depend on the coming results season, which will need strong performance to attract capital and support the market.
"For pharma stocks, only large-caps are worth watching now; if market breaks out and funds return to tech, pharma rally may end"
Pharmaceutical stocks have been extremely strong in recent days, with gains across the board. Yuen Che Hay believes the sector was initially driven by expectations of overseas expansion, especially as year-to-date licensing income from foreign pharma companies for China pharma firms has already surpassed last year's total. This has led market funds to actively seek out different pharma stocks in anticipation of positive news pushing share prices higher. However, given the sector's rapid gains recently, Yuen thinks the best entry timing has passed, and those looking to invest now should focus only on larger, more stable names such as CSPC Pharma (01093), Hengrui Pharma (01276), and Hansoh Pharma (03692). Otherwise, understanding the background and investment rationale for many pharma stocks is not straightforward at this stage.
Yuen notes that investing in pharma stocks carries considerable risk, as there is significant R&D funding pressure and frequent share placements, but when there is progress, share price gains can be substantial, so the sector offers high risk and high return. As the rally in pharma stocks has been driven by sector rotation, if the broader market breaks out and funds start to flow back into tech stocks, it could signal the end of the pharma rally. He expects the next month may still see active trading in pharma names, but whether this can last the whole quarter remains uncertain.
"Yuen Che Hay: Hong Kong stocks have breakout potential, but stability depends on results season"
The Hong Kong market continues to consolidate at high levels, with the HSI at one point rising more than 300 points this morning to approach the Mar peak of 24,874, before gains narrowed to over 150 points at midday. Yuen Che Hay, the Co-Director of Investment Strategy of Quam Asset Securities, told ET Net News Agency that although the HSI has recently only hovered at high levels, he remains confident that Hong Kong stocks will set new highs within the year. He pointed out that heavyweight tech stocks have lacked major news lately and have not driven the HSI higher, but capital activity remains strong, with investors frequently chasing non-heavyweight sectors such as pharmaceuticals, indicating that while the market is not fully betting on a broad rally, thematic trading sentiment remains very active.
Yuen Che Hay explained that although a China-US trade agreement has recently been reached, there are still no signs of a global economic upturn, leading to a wait-and-see attitude and range-bound trading at high levels. He is optimistic that as news becomes clearer, the HSI will have the chance to break through 24,874, with an initial breakout target of 25,200. However, he emphasised that whether the market can stabilise above 25,000 will depend on the coming results season, which will need strong performance to attract capital and support the market.
"For pharma stocks, only large-caps are worth watching now; if market breaks out and funds return to tech, pharma rally may end"
Pharmaceutical stocks have been extremely strong in recent days, with gains across the board. Yuen Che Hay believes the sector was initially driven by expectations of overseas expansion, especially as year-to-date licensing income from foreign pharma companies for China pharma firms has already surpassed last year's total. This has led market funds to actively seek out different pharma stocks in anticipation of positive news pushing share prices higher. However, given the sector's rapid gains recently, Yuen thinks the best entry timing has passed, and those looking to invest now should focus only on larger, more stable names such as CSPC Pharma (01093), Hengrui Pharma (01276), and Hansoh Pharma (03692). Otherwise, understanding the background and investment rationale for many pharma stocks is not straightforward at this stage.
Yuen notes that investing in pharma stocks carries considerable risk, as there is significant R&D funding pressure and frequent share placements, but when there is progress, share price gains can be substantial, so the sector offers high risk and high return. As the rally in pharma stocks has been driven by sector rotation, if the broader market breaks out and funds start to flow back into tech stocks, it could signal the end of the pharma rally. He expects the next month may still see active trading in pharma names, but whether this can last the whole quarter remains uncertain.