HK Stock Market Move | Coal stocks are leading the decline, and it is expected that the supply of coking coal will be repaired by the end of the month. Institutions point out that there is little room for downstream profit, which makes it difficult to support coal prices.

Coal stocks lead the decline, as of the time of writing, Yankuang Energy Group (01171) fell by 7.36% to HK$13.1; YANCOAL AUS (03668) fell by 7.09% to HK$33.28; China Coal Energy (01898) fell by 5.17% to HK$11.56; China Shenhua Energy (01088) fell by 4.94% to HK$43.06. On the news front, recently, the Shaanxi Development and Reform Commission issued a notice on "Ensuring Energy Supply for the Peak Summer Demand in 2026", reversing the previous expectations of a tightening in the supply of coking coal. In addition, Trump announced that the US and Iran have reached a peace agreement, and the Iranian Deputy Foreign Minister also confirmed that a memorandum of understanding between Iran and the US has been reached. WTI and Brent futures both fell by 5% intraday, and the expectations for energy substitution have also cooled down. Zhongcai Futures pointed out that the current upward pressure on coking coal is mainly focused on expectations of increased imports and the progress of coal production resumption in China. The increase in Mongolian coal and seaborne coal may have an effect by the end of the month. Additionally, considering the duration of the strong supervision of domestic coal mines and the training time for temporary workers to become formal workers who are responsible for off-balance production, a positive effect is expected to be seen by the end of the month. Furthermore, considering the limited profits of steel mills and iron ore profits, the lack of room for concessions is not enough to support a larger increase.