Tongzhong Hong Kong Stocks Morning Brief | Strait of Hormuz Stirring Global Energy Markets, Oil Prices Surge, Stock Connect Target List Adjusted

【Today’s Headlines】

Strait of Hormuz Stirring Global Energy Markets, Oil Prices Continue to Surge

On March 7, according to CCTV News, the Iranian Islamic Revolutionary Guard Corps stated on the morning of March 7 local time that a commercial oil tanker named “PRIMA” ignored multiple warnings from the Revolutionary Guard Navy and forcibly entered the Strait of Hormuz, then was struck by a drone.

According to JPMorgan’s latest report, since the escalation of the US-Iran conflict, about 8 ships pass through the Strait of Hormuz daily on average, compared to the usual 138 ships, with traffic volume dropping by 94%.

Goldman Sachs’ commodities research team warned in a recent report on March 6 that the risk of rising oil prices is “rapidly expanding.” If no signs of resolution appear in the short term, oil prices could likely break through $100 per barrel this week.

【Market Outlook】

Nasdaq China Golden Dragon Index Up 0.69%

Overnight, U.S. stocks closed with the Dow Jones Industrial Average down 453.19 points at 47,501.55, a decline of 0.95%, down 3.01% last week; the S&P 500 fell 90.69 points to 6,740.02, down 1.33%, down 2.02% last week; the Nasdaq Composite dropped 361.31 points to 22,387.68, down 1.59%, down 1.24% last week. Major tech stocks declined across the board, with Intel down over 5%, Nvidia down 3%, Amazon, Tesla, and Meta down over 2%.

The Nasdaq China Golden Dragon Index rose 0.69%, with GDS Holdings up over 7%, JD.com up over 6%, XPeng Motors up 6%, Ctrip, NetEase, and others up over 3%. The Hang Seng Index ADR declined, with a proportional decrease, closing at 25,432.94 points, down 324.35 points or 1.26% from Hong Kong market close.

NYMEX WTI crude oil futures for the current month rose $10.26 to close at $91.27 per barrel, a gain of 12.67%. COMEX gold futures for the current month increased $102.60, up 2.02%, at $5,181.3 per ounce. COMEX silver futures rose $2.51, up 3.06%, at $84.695 per ounce. Spot gold increased $90.61, up 1.78%, at $5,171.72 per ounce. Spot silver rose $2.18, up 2.65%, at $84.44 per ounce.

【Hot Topics Preview】

Adjustment of Hong Kong Stock Connect Targets Under Shanghai-Hong Kong and Shenzhen-Hong Kong Connect

On March 6, the Shanghai Stock Exchange issued a notice on the adjustment of Hong Kong Stock Connect targets. According to the “Implementation Measures for Shanghai-Hong Kong Stock Connect,” the list of stocks eligible for Hong Kong Stock Connect (hereinafter referred to as HK Stock Connect) has been adjusted. Due to index adjustments of the Hang Seng Composite Large Cap, Mid Cap, and Small Cap indices, the list of HK Stock Connect stocks has been updated, adding East Asia Bank (00023), GuoFu Quantum (00290), Lead Intelligent (00470), and removing R&F Properties (00272), Baifu Global (00327), Beijing Capital Airport (00694).

Since Lanzhou Technology (06809) and Lead Intelligent (00470) completed their price stabilization periods in Hong Kong on March 6 and March 8 respectively, and their A-shares have been listed for over 10 trading days, they will be included in the HK Stock Connect scope.

Since Zhaowei Electromechanical (02692), listed on the Hong Kong Stock Exchange as H-shares, does not apply the price stabilization mechanism and its A-shares have been listed for over 10 trading days, it will be included in the HK Stock Connect scope. These adjustments will take effect from the next trading day (March 9).

According to the Shenzhen Stock Exchange’s “Implementation Measures for Shenzhen-Hong Kong Stock Connect,” the list of HK Stock Connect stocks will be adjusted and take effect from March 9, 2026. Stocks added include Lead Intelligent (00470), Dipu Technology (01384), Yao Cai Securities & Finance (01428), JD Industrial (07618), and stocks removed include Beijing Capital Airport (00694), Beijing Automotive (01958), Midea Property (03990).

Kuwait Reports Oil Production Cuts, Iran Conflict Spillover Intensifies Impact

As the spillover effects of the Iran conflict continue to expand in the Middle East, casting a shadow over the global economic outlook, Kuwait has begun reducing oil output due to rapidly depleting crude storage capacity. Sources say Kuwait is discussing further production cuts in the coming days. Data provider Kpler reports that key storage facilities in Saudi Arabia and the UAE are also filling rapidly, with both countries expected to reach storage capacity in less than three weeks.

Federal Reserve’s Waller: Iran War Unlikely to Cause Persistent Inflation

On Friday, March 6, Federal Reserve Governor Waller stated he does not believe the Iran war will have a lasting impact on inflation. In an interview, Waller noted that as gasoline prices rise, consumers may experience a “price shock” at the pump, but policymakers generally ignore this one-time price increase.

Chinese Central Bank Continues to Increase Gold Reserves for 16th Consecutive Month

Data shows that at the end of February, China’s gold reserves stood at 74.22 million ounces, an increase of 30,000 ounces from the previous month, maintaining a 16-month streak of gold accumulation.

National Development and Reform Commission: Establishing a National M&A Fund to Mobilize Over 1 Trillion Yuan

On March 6, Zheng Shanjie, director of the National Development and Reform Commission, said at the Fourth Session of the 14th National People’s Congress that this year, the NDRC will work with the Ministry of Finance and the People’s Bank of China to establish a national-level M&A fund, further improving venture capital exit channels and increasing capital turnover efficiency. It is expected to mobilize over 1 trillion yuan in various funds.

Guofu Hydrogen (02582) Subsidiary Signs Sales Agreement for Flexible Green Ammonia Hydrogen Equipment

Guofu Hydrogen (02582) announced that on March 6, 2026, its wholly owned subsidiary Xinjiang Guofu Mingzhi Hydrogen Technology Co., Ltd. (Guofu Mingzhi) signed a sales agreement with independent third party Hefei Zhongke Hecheng Green Energy Co., Ltd. (the customer) for hydrogen production equipment for a 20,000-ton green fuel demonstration project based on green electricity, with a total contract value exceeding RMB 55 million. Under the agreement, Guofu Mingzhi will supply six sets of 1,000 standard cubic meters/hour alkaline electrolyzers and auxiliary equipment such as rectifier transformers, rectifier cabinets, and separation purification devices.

Xiaobu Xiaobu (00520) Expected Net Loss for 2025 About RMB 290-310 Million, Narrowing 22.2%-27.2% Year-on-Year

Xiaobu Xiaobu (00520) issued a notice that the group expects revenue for the year ending December 31, 2025, to be about RMB 3.8 billion, a decrease of approximately 20% compared to the year ending December 31, 2024. However, net loss is expected to narrow to about RMB 290-310 million from RMB 398 million in 2024, a reduction of approximately 22.2%-27.2%.

Mengniu Dairy (02319) Projects Annual Shareholders’ Profit of About RMB 1.4-1.6 Billion

Mengniu Dairy (02319) announced that due to ongoing changes in consumer demand, channel scenarios, and competitive environment, the company expects total revenue in 2025 to decline by 7%-8% year-on-year. Despite efforts to optimize marketing expenses and control fixed costs, scale economies are still affected, leading to a slight decrease in operating profit margin compared to 2024. The company remains committed to strategic focus, increasing R&D and digital investments to enhance core competitiveness and operational efficiency. It currently expects operating profit margin for 2025 to be between 7.9% and 8.1%, slightly lower than 8.2% in 2024 but higher than previous years.

ZTE Corporation Releases 2025 Performance: Net Profit Attributable to Shareholders of RMB 5.618 Billion, Down 33.32% Year-on-Year

ZTE (00763) announced its 2025 performance, with revenue approximately RMB 133.896 billion, up 10.38% year-on-year; net profit attributable to shareholders of listed companies RMB 5.618 billion, down 33.32%; basic earnings per share of RMB 1.17; proposed final dividend of RMB 4.11 per 10 shares (tax included).

Shangmei Holdings (02145): Profit Surprise – 2025 Revenue and Profit Exceed Expectations, Multi-Brand Full-Category Layout Shows Results

On March 6, 2026, Shangmei Holdings (02145) issued a positive profit forecast. It is expected that for the year ending December 31, 2025, revenue will be approximately RMB 9.1-9.2 billion, a 34%-35.4% increase compared to 2024. Along with revenue growth, net profit is also strong, estimated at RMB 1.14-1.16 billion, up about 41.9%-44.4% from 2024, indicating high growth for the full year.

Upcoming IPOs on March 9 – Dark Market Trading

According to Cailian News, Eston (02715) will list in Hong Kong on March 9 (Monday). As of close, the dark market trading via Liquidity Provider shows a bid of HKD 14.1, down 8.2% from the IPO price of HKD 15.36, with 200 shares per lot, no fees, a loss of HKD 252 per lot.

Youlesai Sharing (02649) will also list in Hong Kong on March 9. Close shows a bid of HKD 10.9, down 0.91% from HKD 11, with 500 shares per lot, no fees, a loss of HKD 50 per lot.

Zhaowei Electromechanical (02692) will list in Hong Kong next Monday. Close shows a bid of HKD 82.80, up 16.16% from HKD 71.28, with 100 shares per lot, no fees, a profit of HKD 1,152 per lot.

【Stock Highlights】

COSCO Shipping Energy (01138): Demand for Legal Oil Tankers Is Rising

CITIC Securities previously issued a research report optimistic about the constrained transportation market of the Strait of Hormuz. The report states the market will evolve in three phases: short-term price fluctuations, mid-term tightening of VLCC capacity driving prices up, and long-term demand release after transportation restrictions are lifted, with further price adjustments. Monitoring Brent crude oil prices is necessary, as prolonged high oil prices could trigger economic volatility and impact oil consumption, affecting the tanker market.

Morgan Stanley’s research indicates that COSCO Shipping Energy (01138) stock price will see an absolute increase within the next 30 days. The stock has recently experienced a correction, making its short-term valuation more attractive. Morgan Stanley sees a 70%-80% probability that geopolitical developments will boost demand for legal oil tankers, considering this scenario “highly likely.”