[ET Net News Agency, 27 March 2026] US pressure-and-engagement tactics aim to bring Iran
to talks, but markets remain cautious on a deal. Overnight, oil rose again, and Google's
claimed tech breakthrough rattled AI chip names, dragging all three major US indexes
lower, with the Nasdaq off more than 2%. The HSI was choppy, down over 100 points early,
but rebounded alongside A-shares and a rally in Hong Kong tech. By midday: HSI was 24,993
(+137, +0.6%), turnover was HKD 135.8 billion; HSCEI was 8,469 (+1.0%); HSTECH was 4,811
(+1.0%).

"Lee Wai Kit: Market stays cautious on Middle East; key HSI support at 24,360"

Although US President Trump extended the US-Iran negotiation window by 10 days, patience
is wearing thin. US stocks also digested headlines on social-media addiction liabilities
and weak memory-chip news, finishing lower. Hong Kong had already slipped yesterday, so it
showed a milder reaction, and hopes that better memory efficiency could help downstream
tech aided a midday rebound. Lee Wai Kit, a financial commentator of TF International,
told ET Net News Agency that although Trump has been talking up US-Iran talks lately, it's
clear the market isn't fully buying. Lee notes turnover in Hong Kong has eased since
yesterday and, heading into the weekend, risk appetite is conservative.
Technically, 25,100 (the 250-day moving average) is a key line. After briefly reclaiming
it, the HSI faced selling, and it still sits below the 10- and 20-day averages, signs of
short-term weakness. Using a 0.382 Fibonacci retracement, Lee sees 24,360 as important
support; if Middle East tensions worsen and NYMEX crude holds near USD 100, support may
slide toward the 0.5 retracement around 23,660.

"SMIC has ahort-term trading window; wait for pullbacks for Hua Hong"

China's two major chipmakers reported. SMIC (00981) posted nearly 40% profit growth to
USD 685m, revenue +16% y/y, gross margin +3ppt, though capex stayed elevated (+~10% y/y).
Lee says the print is solid, 40% earnings growth "more than adequate." But since last
month the stock has been pressured by headlines about Nvidia's H200 supply to China. Any
confirmation of further H200 imports could weigh on SMIC sentiment, leaving the setup a
tasteless mid-term, hard to love despite decent results. With earnings support, it could
still bounce with the market; around HKD 50 may offer support for a rebound toward the
20-day MA.
Overall, Lee prefers the technical setup in Hua Hong (01347), helped by prior chatter
about a 7nm AI chip. Post-results weakness reflected a y/y decline in full-year profit and
higher expectations given its memory exposure. While the stock has defended HKD 80
recently, a soft tape and earnings pressure make a near-term break of HKD 80 plausible.
For those without positions, he suggests waiting for a deeper pullback toward stronger
support around HKD 75 before buying.