HK Stock Market Move | Coal stocks expanded their gains in the afternoon. The safety supervision expanded from private mines to state-owned enterprises, which may make supply constraints more sustainable.

Coal stocks saw an expanded rise in the afternoon. As of press time, KINETIC DEV (01277) rose 4.37%, priced at HK$2.03; China Coal Energy (01898) increased by 2.90%, priced at HK$11.37; Yankuang Energy Group (01171) was up 2.24%, priced at HK$13.25; and China Shenhua Energy (01088) went up by 1.88%, priced at HK$45.5. In terms of news, on August 27, the National Mine Safety Administration issued document No. 84 (2026) titled "Opinions on Further Strengthening the Safety Production Work of State-owned Coal Mining Enterprises," which systematically strengthens the safety management of state-owned coal mines from nine aspects including responsibility for safety inspections, regularization of safety checks, and determination of production and operation indicators. Huatai believes that the introduction of document No. 84 signifies a shift from a series of strengthened safety supervision measures initiated since May 22 from temporary rectification to a more normalized constraint. Considering that state-owned coal enterprises are a crucial part of stabilizing coal supply and production in the country, the medium-term supply elasticity may further decline. China Great Wall indicated that in the current context of the energy crisis, power plants are more focused on the cash break-even point rather than the reporting profit and loss break-even point. The bank mentioned that the reporting break-even point for power plants is 860 yuan and the cash break-even point is 1000 yuan (corresponding to the spot price of thermal coal). The current coal price has already surpassed 900 yuan, approaching the cash break-even point of 1000 yuan, and it has not yet reached the price level of 1155 yuan.