To The Moon

The past week was a thrilling one. Last Monday, the $HSI(HSI)$ plunged by 2.27%, breaking below the 15,000-point mark and hitting a low of 14,794 points. It was just inches away from the lowest value of 14,597 in October 2022!

But then came a series of positive factors that lifted the market's spirits. Bloomberg reported last Tuesday that China is considering introducing policies to stabilize the stock market, and some measures are expected to be introduced as soon as this week, including raising about 2 trillion yuan of stabilization funds, which will be mainly funded by institutions outside of China, and invested in A-share through Shanghai and Shenzhen-Hong Kong Stock Connect.

Last Wednesday, the People's Bank of China announced that it has decided to reduce the deposit reserve ratio of financial institutions by 0.5 percentage points starting from February 5, 2024. Beginning January 25, 2024, the interest rates of refinancing loans, small business refinancing loans, and rediscounting will be cut by 0.25 percentage points each.

The significance of this RRR cut is extraordinary. Firstly, the announcement was made during a press conference instead of the usual way of communicating through the official website of the People's Bank of China. It's very rare for such an announcement to be made before the Hong Kong stock market closes. Secondly, RRR cut is a whopping 0.5 percentage points, rather than the usual 0.25 percentage points each time.

In addition to the official level to release the positive factors, the market also came to the self-rescue good news. Among them, Jack Ma and Joe Tsai announced that they would increase their holdings in $Alibaba(BABA)$ $Alibaba(09988)$ . Mr. Tsai, through his family investment company Blue Pool Capital, bought around $151 million of Alibaba shares on the NewYork Stock Exchange. Mr. Ma bought about $50 million of Alibaba's Hong Kong shares in the fourth quarter, according to people familiar with the matter.

The increase in holdings triggered a surge in Alibaba's share price and also boosted other Chinese concept stocks and the Hong Kong market!

Thanks to these positive developments, the Hang Seng index soared by 4.2% last week!

In terms of sector performance, telecom and financial services led the rally, and healthcare saw significant losses:

The net inflow of southbound funds was HK $4.46 billion last week:

Key Events in Hong Kong Stocks Last Week

1. Lei Jun said that $XIAOMI-W(01810)$ $Xiaomi Corp.(XIACY)$ cars pricing will indeed be somewhat expensive;

2. The US Department of Defense was prohibited from purchasing batteries from six Chinese companies, including $Contemporary Amperex Technology Co.,Ltd.(300750)$ and $BYD Co., Ltd.(BYDDF)$ $BYD COMPANY(01211)$ ;

3. LPR remains unchanged this month, and market interest rate cut expectations are disappointed;

4. Chief Executive of the Hong Kong Special Administrative Region Lee Ka Chiu John said that there is no abnormality in the Hong Kong stock market and he is full of confidence in Hong Kong's competitiveness;

5. It is reported that $Alibaba(BABA)$ $Alibaba(09988)$ 's secondhand trading app Xianyu will soon launch wechat mini program;

6. $TENCENT(00700)$ $Tencent Holding Ltd.(TCEHY)$ spent 6.4 billion yuan to acquire land in Beijing to meet its office needs;

7. Jack Ma replaced $Softbank Group Corp(SFBQF)$ as $Alibaba(BABA)$ $Alibaba(09988)$ 's largest shareholder;

8. The General Office of the People's Bank of China and the General Office of the Financial Supervision Administration jointly issued the Notice on the Management of Operational Property Loans;

9. The relevant person in charge of SASAC said for the first time that it would study the effectiveness of market value management into the assessment of the heads of central enterprises;

10. $Tesla Motors(TSLA)$ 's performance missed expectations, and new energy vehicles companies collectively fell;

11. $EAST BUY(01797)$ released financial results, revenue increased by more than 30% year-on-year, but net profit decreased by more than 50% year-on-year;

12. The National Press and Publication Administration released the approval information of domestic online games in January, a total of 115 games were approved;

13. It is reported that the United States intends to introduce a Biosafety Act to ensure that foreign biotechnology companies do not have access to U.S. taxpayer funds.

Four Stocks Worth Attention Among Top Trading HK Stocks Last Week

Top3: $Alibaba(BABA)$ $Alibaba(09988)$ : Jack Ma and Joe Tsai unexpectedly increased their holdings in Alibaba last week, greatly boosting market confidence and soaring stock prices;

Top6: $XIAOMI-W(01810)$ $Xiaomi Corp.(XIACY)$ : Tesla released earnings last week, said that the growth rate of automotive business in 2024 will be lower than that in 2023, sending the stock crashing, and the stock price performance of new energy vehicles was under pressure;

Top8: $EAST BUY(01797)$ : the company released the first half of the fiscal year 2024 results last week. Although revenue increased significantly, net profits plunged, sending the stock crashing;

Top9: $WUXI BIO(02269)$ $Wuxi Biologics Cayman Inc.(WXIBF)$ : the market reported last Friday that the United States planned to introduce the "Biosafety Act", with Wuxi Biologics being named. This news caused a stock plunge.

This week's Hong Kong stock market events

1. On Wednesday, China will release PMI data for January, so we will be watching to see if China's economy has improved;

2. On Thursday, the Federal Reserve will issue interest rate resolution and release monetary policy statement, pay attention to the stance of officials;

3. Next week, the US stock market will usher in the earnings season, and a number of giants will report earnings. We will be watching to see how these results affect Hong Kong's corresponding companies. $SoFi Technologies Inc.(SOFI)$ $General Motors(GM)$ $Pfizer(PFE)$ $Advanced Micro Devices(AMD)$ $Microsoft(MSFT)$ $Alphabet(GOOG)$ $Alphabet(GOOGL)$ $Apple(AAPL)$ $Meta Platforms, Inc.(META)$ $Amazon.com(AMZN)$