Coal sector stocks are mostly trading higher.

Supply constraints are expected to last longer than the market anticipated due to mine accidents coinciding with the traditional June period for intensified safety and environmental inspections.

On the demand side, daily consumption at power plants has increased sequentially and is significantly higher year-on-year due to the influence of the subtropical high pressure system.

The expectation of hot weather is gradually materializing, which, if sustained, is likely to further stimulate power plants' inventory replenishment activities, providing support for coal prices.

Following a severe mine accident in Shanxi last week, safety inspections are ongoing, and it is anticipated that the scope of short-term production halts and maintenance may expand, directly suppressing the release of effective regional supply.

Furthermore, as temperatures rise in the coming period, peak season demand for coal is expected to gradually commence.

High uncertainty in the U.S.-Iran conflict corresponds to high volatility, but oil prices are unlikely to see a significant short-term decline.

With the Producer Price Index (PPI) for coal turning positive and coal prices on an upward trajectory, coal stocks are poised for a potential Davis double play.

YANKUANG ENERGY (HKEX: 01171)

Yankuang Energy's share price rose 6.87% to HKD 15.56.

CHINA COAL (HKEX: 01898)

China Coal's share price increased by 6.65% to HKD 13.48.

SHOUGANG RES (HKEX: 00639)

Shougang Resources' share price climbed 6.25% to HKD 2.89.

CHINA SHENHUA (HKEX: 01088)

China Shenhua's share price advanced 4.66% to HKD 47.18.