[ET Net News Agency, 06 January 2026] Global equities kicked off the new year on a positive note, with energy and traditional sectors leading gains overnight. The Dow Jones surged 594 points, or 1.23 per cent, to close at 48,977, while other major indices also advanced. Although the Hang Seng Index saw modest profit-taking yesterday, a strong wave of southbound inflows provided fresh impetus this morning. After opening 155 points higher, Hong Kong stocks extended their advance, with sectors such as insurance, property, metals, and local real estate all moving higher. The Hang Seng Index at one point soared over 500 points to reach 26,858, its highest level since 14 November last year, before ending the morning session up 468 points or 1.8 per cent at 26,815. Main board turnover approached HKD 162.7 billion, though net southbound inflows stood at HKD 1.86 billion.
The Hang Seng China Enterprises Index rose 147 points or 1.6 per cent to 9,296, while the Hang Seng Tech Index gained 126 points or 2.2 per cent to 5,868.
"Wan Kong Shing: Focus on AI themes this quarter, outlook for Chinese oil majors turns softer"
Following the new year, Hong Kong stocks have clearly reversed course, with southbound capital returning in force as HKD 18.7 billion flowed into the market yesterday, confirming that last Friday's 700-point surge was more than a flash in the pan. This morning, aggressive buying continued, pushing the HSI up by nearly 500 points to challenge resistance at 26,800 ahead of 27,000. Wan Kong Shing, the Chief Investment Officer of iFAST Global Markets, told ET Net News Agency that capital rotation is evident in the new year. Although 26,800 was initially seen as a resistance level, the market reached it in one session, so the new resistance target for January is 27,000. With strong market momentum and three months of consolidation behind, Wan believes an upside breakout above the October high at 27,381 is more likely than a retreat below the 26,000 support.
Wan expects the Hong Kong market to remain focused on AI themes in the first quarter, with technology and metals stocks likely to outperform. In contrast, he sees limited upside for energy names, particularly oil majors, given the prospect of US control over Venezuelan oil production, which could disrupt supply chains established by Chinese oil companies and weigh on their outlook.
Venezuela is China's largest debtor in Latin America, accounting for 45 per cent of the region's allocated funds. Following the political shift in Venezuela, reports suggest the China Banking and Insurance Regulatory Commission has asked policy banks and major lenders to report their exposure to Venezuelan loans in order to assess potential risks. A-shares of Chinese banks and some non-blue-chip Mainland China lenders have come under pressure. Wan believes China has long managed its exposure in Venezuela and, while some risks remain, prudent controls mean the impact on Mainland China banks should be limited. Since 2015, China has refused to extend new loans to Venezuela, so he expects current pressure on bank stocks is driven more by market concerns over loan recovery than by fundamental threats. As such, the sell-off in bank shares is unlikely to persist.
"Sunny Optical's lidar development lags, little excitement for spin-off"
Nvidia announced the open-sourcing of its first inference VLA model, Alpamayo 1, designed to handle complex driving scenarios using human-like reasoning and assist autonomous vehicles in real-world situations. CEO Jensen Huang said the first vehicles equipped with Alpamayo 1 will hit US roads in the first quarter. The news boosted smart driving concept stocks, and Sunny Optical (02382), which has been developing lidar technology, also signalled it is considering spinning off its lidar business for a Hong Kong listing. Still, the share price rose initially but then retreated.
Wan noted that despite years of investment in lidar, Sunny Optical has yet to deliver meaningful revenue or profit from the segment. While the company is now looking to spin off the business amid the technology IPO boom, the muted share price reaction shows that market expectations are low, unlike Baidu's (09888) Kunlun chip unit, which is already well-known to investors. Even with a spin-off, Sunny Optical is unlikely to replicate Baidu's rally. Wan expects the stock to remain range-bound in the near term, with resistance at HKD 70 after breaching the 50-day moving average this morning, but with momentum lacking, it is likely to fluctuate between HKD 62.5 and HKD 72.
Although both China and the US are actively advancing autonomous driving, Wan remains cautious on the sector's overall prospects. He explained that while Baidu and Alphabet already have robotaxis operating, neither has delivered impressive financial results, and the sector's revenue and profit potential will take time to materialise. Currently, Mainland China is conducting L3-level smart driving road tests, but Wan observed that more time is needed to validate safety before widespread adoption. While smart driving features can enhance new cars, significant price increases could deter consumers, as autonomous driving is not yet a key purchasing factor. As a result, Wan expects the industry to maintain a steady pace of development without rapid growth in the near term.
The Hang Seng China Enterprises Index rose 147 points or 1.6 per cent to 9,296, while the Hang Seng Tech Index gained 126 points or 2.2 per cent to 5,868.
"Wan Kong Shing: Focus on AI themes this quarter, outlook for Chinese oil majors turns softer"
Following the new year, Hong Kong stocks have clearly reversed course, with southbound capital returning in force as HKD 18.7 billion flowed into the market yesterday, confirming that last Friday's 700-point surge was more than a flash in the pan. This morning, aggressive buying continued, pushing the HSI up by nearly 500 points to challenge resistance at 26,800 ahead of 27,000. Wan Kong Shing, the Chief Investment Officer of iFAST Global Markets, told ET Net News Agency that capital rotation is evident in the new year. Although 26,800 was initially seen as a resistance level, the market reached it in one session, so the new resistance target for January is 27,000. With strong market momentum and three months of consolidation behind, Wan believes an upside breakout above the October high at 27,381 is more likely than a retreat below the 26,000 support.
Wan expects the Hong Kong market to remain focused on AI themes in the first quarter, with technology and metals stocks likely to outperform. In contrast, he sees limited upside for energy names, particularly oil majors, given the prospect of US control over Venezuelan oil production, which could disrupt supply chains established by Chinese oil companies and weigh on their outlook.
Venezuela is China's largest debtor in Latin America, accounting for 45 per cent of the region's allocated funds. Following the political shift in Venezuela, reports suggest the China Banking and Insurance Regulatory Commission has asked policy banks and major lenders to report their exposure to Venezuelan loans in order to assess potential risks. A-shares of Chinese banks and some non-blue-chip Mainland China lenders have come under pressure. Wan believes China has long managed its exposure in Venezuela and, while some risks remain, prudent controls mean the impact on Mainland China banks should be limited. Since 2015, China has refused to extend new loans to Venezuela, so he expects current pressure on bank stocks is driven more by market concerns over loan recovery than by fundamental threats. As such, the sell-off in bank shares is unlikely to persist.
"Sunny Optical's lidar development lags, little excitement for spin-off"
Nvidia announced the open-sourcing of its first inference VLA model, Alpamayo 1, designed to handle complex driving scenarios using human-like reasoning and assist autonomous vehicles in real-world situations. CEO Jensen Huang said the first vehicles equipped with Alpamayo 1 will hit US roads in the first quarter. The news boosted smart driving concept stocks, and Sunny Optical (02382), which has been developing lidar technology, also signalled it is considering spinning off its lidar business for a Hong Kong listing. Still, the share price rose initially but then retreated.
Wan noted that despite years of investment in lidar, Sunny Optical has yet to deliver meaningful revenue or profit from the segment. While the company is now looking to spin off the business amid the technology IPO boom, the muted share price reaction shows that market expectations are low, unlike Baidu's (09888) Kunlun chip unit, which is already well-known to investors. Even with a spin-off, Sunny Optical is unlikely to replicate Baidu's rally. Wan expects the stock to remain range-bound in the near term, with resistance at HKD 70 after breaching the 50-day moving average this morning, but with momentum lacking, it is likely to fluctuate between HKD 62.5 and HKD 72.
Although both China and the US are actively advancing autonomous driving, Wan remains cautious on the sector's overall prospects. He explained that while Baidu and Alphabet already have robotaxis operating, neither has delivered impressive financial results, and the sector's revenue and profit potential will take time to materialise. Currently, Mainland China is conducting L3-level smart driving road tests, but Wan observed that more time is needed to validate safety before widespread adoption. While smart driving features can enhance new cars, significant price increases could deter consumers, as autonomous driving is not yet a key purchasing factor. As a result, Wan expects the industry to maintain a steady pace of development without rapid growth in the near term.