[ET Net News Agency, 27 December 2024] The U.S. stock market stabilized after the
holidays, while in the Hong Kong stock market, despite some domestic demand stocks facing
selling pressure, many Mainland China technology stocks surged early on, driving the Hang
Seng Index to erase half-day losses, closing at 20,121, up 23 points or 0.1%, with a
midday high of 20,184 points, reaching a new high in nearly half a month. The turnover of
the main board exceeded HKD 85.6 billion in the first half of the day. The Hang Seng China
Enterprises Index closed at 7,316, up 12 points or 0.2%. The Hang Seng Tech Index closed
at 4,561, up 54 points or 1.2%.

"Kwok Ka Yiu: Hang Seng Index is expected to maintain narrow fluctuations, but the
positive signals are evident"

Kwok Ka Yiu, the Director of Business Development at Harbour Family Office, told ET Net
News Agency that due to cautious market sentiment approaching the holiday season, the Hang
Seng Index is expected to continue to experience narrow fluctuations. On the external
front, with U.S. bond yields remaining high, there is some impact on the Hong Kong stock
market sentiment, but the overall situation in the Hong Kong stock market is still
relatively good. He pointed out that in recent trading days, there have been continuous
hot topics attracting funds, such as chip stocks, cloud concepts, and high-yield stocks.
In addition, with the Hang Seng Index staying above the 20,000 point level, risk appetite
is increasing, which are all positive signals. However, the likelihood of breaking through
the high of 20,300 before the holidays is low, with short-term predictions hovering around
the 20,000 point mark, mainly stable with a slight upward trend.

"WuXi series avoids sanctions, but market concerns remain"

WuXi AppTec (02359) announced that two indirectly wholly-owned subsidiaries, as entities
of WuXi ATU, signed a share purchase agreement with the U.S. private equity fund Altaris
on Tuesday (24th) to sell all the shares of WuXi Advanced Therapies and Oxford Genetics,
expected to be completed in the first half of next year.
WuXi AppTec's stock price fell today as it divested sensitive businesses, dropping to
HKD 53.4 in early trading, a 4% decline. Kwok Ka Yiu stated that the main reason for the
stock price decline still lies in geopolitics. Biotechnology has always been a focal point
of Sino-U.S. tensions, and with less than a month until Trump takes office, Sino-U.S.
relations may face a more severe situation. He admitted that although WuXi AppTec has
divested sensitive human gene-related businesses, uncertainties still loom over the
prospects of the company's core businesses. He frankly stated that the biotechnology
sector has been forgotten by many investors. Investment standards in biotechnology are not
related to company business earnings but mainly depend on the certainty of external risks.
WuXi AppTec's announcement stated that in the first 11 months of this year, the total
operating income of Advanced Therapies and Oxford Genetics was approximately RMB 980
million, accounting for 2.4% of the group's audited operating income in the most recent
fiscal year. Kwok Ka Yiu pointed out that as WuXi AppTec sells its UK and U.S. operating
entities and with unclear external policies, investors are concerned that the company's
business will be limited to the Mainland China, affecting investors' imagination.
Therefore, even though WuXi AppTec's divestment of businesses will generate special
income, the stock price has not strongly reflected this.
Earlier, the U.S. Senate and House of Representatives proposed the "Biological Security
Act," targeting the WuXi AppTec series with Chinese backgrounds. Although the bill was not
included in next year's U.S. National Defense Authorization Act and is unlikely to pass
this year, Kwok Ka Yiu pointed out that with pricing undisclosed, the company's management
may have cashed out before the company's value further diminishes amid increases external
risks. Although the actual implementation deadline of the "Biological Security Act" is
uncertain, the risk still exists, greatly impacting the company's business partnerships
and potentially limiting new order quantities, prompting the decision to sell sensitive
businesses now.