HK Stock Market Move | Coal stocks rise against the market trend, Shanxi releases new safety regulations for coal mines, and coal substitute demand grows amid geopolitical disturbances.

Coal stocks rose against the market. As of the press release, YANCOAL AUS (03668) rose 5.49% to 33.64 Hong Kong dollars; Yankuang Energy Group (01171) rose 4.48% to 12.13 Hong Kong dollars; China Coal Energy (01898) rose 3.03% to 10.88 Hong Kong dollars; China Shenhua Energy (01088) rose 1.95% to 43.98 Hong Kong dollars. On the news front, the "Seventeen Regulations for the Overall Planning of Coal Industry Development and Safety in Shanxi Province" is expected to be released soon, aiming to completely clean up hidden coal mining faces and strictly prohibit coal mining enterprises from using underground labor dispatch in any form. In addition, with the official start of the hot summer season after mid-July, the demand for thermal coal is expected to improve. It is worth noting that the ongoing US-Iran war, President Trump has stated that the US will soon launch strikes on Iran's underground facilities. Meanwhile, the Houthi armed forces officially announced the blockade of Saudi Arabia on July 20, posing risks of blockage for the Strait of Hormuz and the Strait of Mandeb. Shanxi released a research report stating that the price of thermal coal has entered a reasonable range, supply is restrained, and the peak season for coal prices has support. With the transition from the low season to the peak summer season, the trading focus of coal stocks may gradually shift from coking coal to thermal coal or integrated coal and electricity. During the interim report season, market trading styles focus on performance, and coal stocks have a repair base after experiencing adjustments. Founder believes that the resilience of coal stocks is evident in the face of adversity, and the repair market is expected to deepen. The bank points out that the growth in alternative demand for coal, improvement in the supply-demand structure of coal, and companies with strong coal price elasticity are expected to benefit first.