When the clock struck twelve, the morning session of the stock market came to a close. One by one, investors streamed out of the exchange hall.
The most talked-about stock of the day was undoubtedly Wharf Holdings. Although its closing price for the morning session stood at HK$13.68—only slightly higher than the opening price—it still represented a nearly 4% increase compared to yesterday's close. On paper, that wasn't bad at all.
But the problem was this: Wharf's intraday high had once soared to HK$19.91.
Compared to that, the HK$13.68 close was a painful drop.
The wild volatility had everyone talking, especially those who hadn't bought in. They bragged about how much money they could have made — "If only I'd bought at the open and sold at the top, I'd have made a fortune!" Each man sounded like a self-proclaimed market genius.
Among them, Chen Baocai drifted out of the exchange, dazed and empty.
Hearing all the chatter around him, he couldn't help but curl his lips into a bitter smirk.
He had held Wharf shares before the market even opened that day. Early in the session, he'd added to his position around HK$14, and again above HK$15.
At one point, when the price reached its peak, he was up nearly 40%—his profit had almost touched HK$20,000.
He had planned to sell near the high. He'd even started moving to the counter when the stock was climbing fast. But by the time he got there — mere seconds later — the price had already started crashing.
He didn't even have time to sell.
Later, when the stock fell below his cost basis, Chen simply refused to sell anymore.
Going from nearly HK$20,000 in profit to sitting on a loss was too much to stomach. He decided to hold, hoping for a rebound.
Listening to those boasting around him, Chen couldn't help but think: If they were in my shoes, would they really have done better?
Everyone dreams of selling at the very top. But when the crash comes — no one escapes in time.
They all talk like gods of the stock market, but in reality? They're no different from me.
The morning's violent swing in Wharf's stock didn't go unnoticed. Even if Jardine Matheson hadn't previously realized that someone was secretly accumulating Wharf shares, the sheer volatility was impossible to ignore.
However, Henry Keswick, chairman of Jardine Matheson's board, never imagined that this might be a prelude to a takeover.
He simply assumed that some financial institution was manipulating the stock — pushing it up and down as part of a speculative play.
Thus, Keswick merely instructed the investment department to monitor Wharf's price closely. As long as the stock didn't collapse, there was no need to interfere.
But if it fell too sharply — if Wharf's total market value dropped below HK$1 billion — they were to report to him immediately.
Wharf's performance had been poor in recent years, and its stock had already declined significantly. Keswick couldn't afford to let it fall further. If its market cap dipped below that HK$1 billion threshold, he would personally step in — requesting funds from the board to support the price and restore investor confidence.
Still, to calm the market — and because of the morning's dramatic volatility — Keswick ordered a public announcement to be issued.
The statement read that "Wharf Holdings has no undisclosed news that would materially affect its performance. The company's operations remain stable and normal. Shareholders need not be concerned."
His intentions were good. He wanted to reassure investors, to signal that nothing was wrong.
But the effect was disastrous.
Many traders had assumed that the morning's surge was driven by good news yet to be revealed. They believed someone with inside information was buying in advance.
The official statement, which flatly denied any such news, was like a bucket of ice water poured over the market's head.
The sentiment turned instantly cold.
If there was no hidden good news… wasn't that, in itself, bad news?
As soon as the afternoon session opened, Wharf's stock turned sharply downward.
It broke below yesterday's closing price, slipped under HK$13, and continued to fall relentlessly.
Seeing this, An Yuan ordered his people to keep a close watch.
"If any large capital starts buying Wharf in bulk," he said, "notify me immediately."
At the same time, he placed an international call to Lin Baicheng, who was still in the United States. He needed instructions — should they continue to push the price down before buying, or stop suppressing it and prepare to purchase once it reached a certain range?
Lin Baicheng had gone to the U.S. for one reason: to raise funds.
At his current level of wealth, only two assets were valuable enough for major financing — his shares in Galaxy Games, and the Wharf Holdings stock he had quietly been accumulating.
The first was easy enough to use as collateral.
But the Wharf shares? That was another story.
If he pledged those shares to a Hong Kong bank, word would spread quickly. People would realize that Lin had borrowed heavily against his Wharf holdings — and that would expose his takeover plans in an instant.
But an American bank was different.
Such information would never reach Hong Kong; the two markets had almost no communication channels.
Hong Kong, still a British colony, was dominated by British capital. American finance had barely touched the city, and few U.S. banks had any meaningful presence or network there.
That's why Lin wasn't afraid of his secret leaking — not from across the Pacific.
To speed up the process, Lin enlisted the help of Phil Smith, who used his connections to introduce Lin to a senior executive at Goldman Sachs.
Goldman Sachs was primarily an investment and financial services firm, not a traditional lending bank. But that didn't matter — Phil's connections were there, and Lin didn't care what kind of bank it was, as long as it gave him the money.
However, large-scale loans take time.
Collateral valuation, loan amount, term, interest rate — all had to be negotiated.
And Lin had only just arrived in the U.S., having only recently been introduced to Goldman's executive. There was no way the deal could be completed overnight.
When Lin received An Yuan's report about the chaos in the Hong Kong market, he paused to think, then issued clear orders.
He was convinced that the other side secretly accumulating Wharf shares was none other than Li Jiacheng.
Without knowing Li's next move, Lin couldn't afford to suppress the price too much — if he pushed it too low, Li would scoop up cheap shares, effectively profiting off Lin's work.
At the same time, Lin's available cash was still limited.
If his intentions became obvious, the price would skyrocket — and he'd have no money left to buy in.
Therefore, Lin's orders were precise:
"Don't deliberately push the price down anymore. Keep buying quietly, but stop once it exceeds HK$15. Let the market adjust on its own.
If major funds enter and push the price above HK$25, sell off a portion of our holdings — as much as they can absorb. Dump into the rally."
Selling at that level served two purposes.
First, it would pressure the price again, disguising his real motive.
Second, it would lock in nearly 100% profit on those shares.
Even if Lin ultimately failed to take over Wharf, he would still walk away with a gain of around HK$200 million — a hefty reward for a well-played game.