China Coal Energy (01898) saw its stock price plummet 5.73% during intraday trading on Wednesday, reflecting a broad decline across Hong Kong's coal sector.

The sharp drop follows market news indicating that the ceasefire between the US and Iran remains temporarily in place, with Pakistan's Foreign Minister expressing confidence in mediation efforts. According to analysis from Founders Securities, the coal sector has recently benefited from investment themes tied to energy crises driven by geopolitical tensions. Should the US-Iran conflict ease quickly, the potential for significant coal price increases would be relatively limited, reducing the sector's risk premium appeal.

CITIC Securities added that while continued declines in coal prices could pressure profitability, some firms have shown quarter-on-quarter improvements. The institution remains cautiously optimistic about coal price performance in the second quarter, noting that even if Middle East tensions ease, restoring energy supplies will take time, and domestic and international coal prices may align in the mid-to-late second quarter.