The market analysis yesterday mentioned that Trump would issue an "important update" on Iran, noting the timing just before our market opened and watching for potential disruptions. As anticipated, the impact was targeted, with the Hong Kong market gapping down 0.70% today. Looking at the specifics: Trump first claimed a "swift, decisive, and overwhelming victory" in the conflict with Iran, stating that Iran's missile and drone capabilities had been "significantly degraded" and that its weapons factories and rocket launchers were "largely depleted." He described the U.S. military strikes on Iranian nuclear facilities as a "great success," reducing the nuclear threat for the U.S. and other nations. In short, he declared a complete victory, thus negating the need for assistance from other countries. Regarding the Strait of Hormuz, since the U.S. does not rely on it for oil imports, he suggested that countries dependent on the strait must "take responsibility for keeping the passage open," even encouraging them to "seize oil" directly from the Hormuz Strait, claiming it would "naturally reopen" once the Iran conflict concluded. This stance leaves European nations, Japan, and South Korea in a difficult position, as the U.S. and Israel initiated the conflict without consultation, leading to the strait's blockade by Iran, with these allies bearing the brunt of the consequences while receiving no support, and even being asked to participate. Spain demonstrated the clearest judgment by refusing involvement from the outset, leveraging its control of the Strait of Gibraltar, which limits U.S. influence. The U.K. has since reconsidered, with Keir Starmer stating that no persuasion would lead to involvement in another nation's war. France and Italy have also expressed non-support and non-participation. Europe faces severe challenges, still dealing with the fallout from the Russia-Ukraine conflict, excluded from negotiations, and now confronting worsened oil and gas supplies due to the strait blockade. Trump's remarks served U.S. interests by touting achievements and easing tensions, with U.S. stocks responding positively in the evening session. However, a disruption emerged later when Trump, after previously mentioning troop withdrawal despite the blockade, stated that the U.S. would launch an "extremely intense" strike on Iran within the next two to three weeks to "send them back to the Stone Age, where they belong." This indicates continued strategic maneuvering without actual withdrawal, agreements, or action, raising questions about market credibility if such rhetoric persists. Further military action is likely, as verbal threats alone may not boost approval ratings, necessitating a "hard" conflict for a resolution. According to CCTV reports, U.S. officials are discussing a high-risk plan involving special forces entering Iran to seize 440.9 kg of 60% enriched uranium. The delay may await an optimal timing for a swift strike and exit. Iran's Army Chief warned today that any ground offensive would result in no enemy survivors, suggesting more drama ahead. Given Trump's speech did not announce withdrawal, energy prices rose必然; on April 2, WTI crude futures surged over 6%, and European natural gas prices jumped up to 7.2% to €50.95 per MWh. In Hong Kong, Shandong Molong Petroleum Machinery (00568) soared over 16%, and BQE Water Services (02178) gained over 9%. Gold, being inversely related, declined. Tech stocks also reversed, with previously strong performers like Zhipu AI (02513) and MINIMAX (00100) adjusting. Managing this rhythm is crucial. Pharmaceuticals remain relatively stable, as highlighted repeatedly, with this sector largely unaffected by conflicts and showing independent trends. Today, many continued to rise, such as pharmaceutical platform BioMap (02315) up over 6%, Luye Pharma Group (02186) up nearly 8% on 31% profit growth, Hansoh Pharma (03692) up over 5% with high growth expectations for 2026, and Rongchang Biotechnology (09995) up over 4% on clinical approval for a dual-antibody ADC cancer drug. Rising oil prices have improved the logic for electric vehicles. The upcoming Beijing Auto Show in April, as the first major domestic exhibition in 2026, will be a key platform for automakers to showcase technology. For automaker stocks to rise, sales figures are the primary catalyst. On April 2, Chery Group (09973) announced that after becoming the first Chinese brand to exceed 6 million cumulative exports in February, it set a new monthly record with 148,777 vehicle exports in March, up 72% year-on-year; Q1 exports totaled 393,311 units, up 53.9%. Chery has now exceeded 100,000 monthly exports for 11 consecutive months, surging over 15% today. Geely Automobile (00175) reported March total sales of 233,031 vehicles, roughly flat year-on-year. While overall growth slowed, Zeekr stood out with 29,318 deliveries, up 90%—a remarkable pace that explains its strong performance last month, rising over 8% today. Leapmotor (09863) is another rising star, with March deliveries reaching 50,029 units, up 35%, re-entering the "50,000 club." Its new A10 model achieved over 10,000 orders in record time, with over 9,000 orders in the last weekend of March. Additionally, the full-size flagship SUV D19 will launch on April 16, expanding Leapmotor's product range from A to D class, covering prices from 100,000 to over 300,000 yuan, up over 3% today. Great Wall Motor (02333), at a low point, also moved today, driven by its overseas business, which generated RMB 91.488 billion in revenue in 2025, up 13.99%, accounting for over 40% of total revenue. The company revised down its 2026 employee incentive targets, lowering the sales goal from 2.49 million to 1.8 million vehicles, a 36% increase from last year's actual sales, while maintaining the net profit target of at least RMB 10 billion. Shifting from blind sales pursuit to practical profit focus reduces pressure, up over 7% today. Bright Smart Securities (01428) announced that Ant Wealth successfully acquired a 50.55% stake for HKD 2.814 billion. With Ant taking over, Ant-affiliated executives have joined the board, and the founder has resigned. Integration with Ant's ecosystem, such as Ant Bank and Alipay HK, aims to create synergies in wealth business, up over 6% today. The Hong Kong government's planned stablecoin license issuance in March has yet to materialize but is expected soon, with Jingwei Tian Di (02477) up over 5%.
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