To The Moon

This week, Hong Kong stocks saw a strong rebound, with the $HSI(HSI)$ rising 2.73% over the week.

Key Data and Market Reactions

On Friday, the U.S. Labor Department reported that 256,000 jobs were added in December, far exceeding the market's expectation of 165,000. The unemployment rate dropped from 4.2% in November to 4.1%. This led to speculation that the Fed may delay interest rate cuts, which caused a drop in U.S. stocks and negatively impacted the Hong Kong market.

On Wednesday, the U.S. December CPI showed a 2.9% year-on-year increase, matching expectations. Core CPI, which had been rising for months, showed signs of slowing down. The market now anticipates the Fed might cut rates by July, earlier than the previous forecast of September.

Positive Signals from China

Domestically, several investment banks are optimistic about China’s stock market. Goldman Sachs’ Kinger Lau and his team predicted a 20% increase in the MSCI China Index and the CSI 300 by the end of 2025. Meanwhile, J.P. Morgan expects a market turnaround by the end of January.

With this optimism, Hong Kong and A-shares rebounded strongly, especially on Tuesday when the ChiNext Index surged by 4.7%, easing market pessimism.

On Friday, China’s National Bureau of Statistics released positive economic data. Q4 GDP grew 5.4% year-on-year, far surpassing expectations. December’s industrial output grew 6.2%, the fastest pace since April, exceeding the predicted 5.4%. Retail sales for December rose 3.7%, beating the expected 3.6%.

With this better-than-expected data, Hong Kong and A-shares continued their upward trend on Friday.

This week, sectors like communications, energy, and finance performed well.

Southbound funds saw a net inflow of HK $42.7 billion this week.

Major Events in Hong Kong Stocks This Week

1. U.S. added 256,000 jobs in December, exceeding expectations.

2. Counterpoint reported global smartphone sales are expected to grow 4% in 2024.

3. $WUXI APPTEC(02359)$ sold 2 billion yuan worth of $WUXI XDC(02268)$ shares.

4. $BEIGENE(06160)$ announced they expect to reach positive operating profit by 2025.

5. TikTok “refugees” flock to Xiaohongshu, boosting related stocks.

6. $Great Wall Motor Company Limited(601633)$ expects a 77%-85% increase in net profit for 2024.

7. $CM BANK(03968)$ ’s 2024 net profit is expected to be 148.39 billion yuan, up 1.22%.

8. New loans in 2024 are expected to reach 18.09 trillion yuan.

9. $LEAPMOTOR(09863)$ expects to turn a profit in Q4 of 2024, reaching its target one year ahead.

10. U.S. December CPI rose 2.9% as expected.

11. Starting January 20, China will implement new subsidies for mobile phones and digital products.

12. $CTG DUTY-FREE(01880)$ expects a 36.5% drop in 2024 net profit.

13. December 2024 housing prices in tier-1 cities increased month-on-month.

14. 2024 GDP reached 13.49 trillion yuan, growing 5.0%, surpassing expectations.

Three Stocks Worth Attention Among Top Trading HK Stocks This Week

Top1: $SMIC(00981)$ . Following tighter U.S. export controls on advanced chips, China is accelerating its domestic chip production. SMIC surged, approaching a historic high.

Top7: $XPENG-W(09868)$ . The company aims to deliver 190,000 vehicles in 2024, with a target of 350,000.

Top9: $UBTECH ROBOTICS(09880)$ . After a sharp drop due to rumors of unlocked shares, the stock rebounded after executives pledged not to sell shares for a year.

Next Week's Hong Kong Stock Market Events

1. Next Monday, U.S. markets will be closed for Martin Luther King Jr. Day.

2. Next week, major earnings reports from $Netflix(NFLX)$ and $Texas Instruments(TXN)$ could impact the U.S. stock market.