Review of January 2nd ＊

$Hang Seng Index (800000.HK)$First, let’s review the trend from last week:

It is very clear that last week’s trend was a continuous up-and-down movement of hundreds of points. The trend was extremely volatile. I have previously mentioned the important level of 26050, which has now been firmly surpassed. On that day, due to breaking through and stabilizing above 26050, I also bought bullish warrants. I partially took profits during the day, but left the rest untouched for two reasons. Although trading volume was low on Friday, the market pattern became notably different. Additionally, I’ve frequently shared that mainland China's A-shares have recently been very strong, and Hong Kong stocks are inevitably influenced to some extent. This is why I didn’t sell all my bullish warrants, and the night session on Friday $HSI Futures Current Contract (HSIcurrent.HK)$ saw a surge of more than a hundred points at one stage, but when news broke around 1 AM on January 3rd that the US attacked Venezuela and arrested President Maduro, the index gradually retreated. This event quickly impacted global markets, particularly sectors like energy, defense, and safe-haven assets. Both the US and Hong Kong stock markets may experience volatility. This sudden attack could lead to rising energy prices, benefiting oil and gas sectors. As Venezuela holds the largest proven oil reserves globally, military actions disrupting its oil exports will drive up international oil prices. In the short term, oil and gas extraction, oil services, and tanker transportation stocks in Hong Kong and mainland China markets will clearly benefit. If risk aversion rises, it might affect foreign capital inflows and emerging market asset allocation. Although this may temporarily impact the market, it won’t change long-term trends. Personally, I think the influence of the US strike on Venezuela will be limited because market focus remains on technology and AI sectors, such as chips, servers, and cloud computing. Moreover, the technical outlook is currently bullish unless there's a sharp drop affecting the overall trend, presenting potential buying opportunities on dips. As for how things will unfold? No one knows for sure, so let's just wait and see.

When predicting the trend of the Hang Seng Index, in addition to referencing the dynamics of Hang Seng Index futures, one can also refer to the performance of constituent stocks, such as $TENCENT (00700.HK)$ $BABA-W (09988.HK)$ $HSBC HOLDINGS (00005.HK)$ $AIA (01299.HK)$ $MEITUAN-W (03690.HK)$ $CCB (00939.HK)$ $CHINA MOBILE (00941.HK)$ $HKEX (00388.HK)$ These are also the top eight component stocks with the largest weightings, serving as a useful reference.

In my view, technology stocks will not experience a significant pullback and are likely to maintain a certain level of support. Therefore, any pullback could present an opportunity to gradually accumulate positions at lower levels. For index tracking, $Hang Seng Tech Index (800700.HK)$ one can consider entering at key support levels, while related ETFs may also serve as references, such as: $China Merchants Hang Seng Technology (03423.HK)$ It is an exchange-traded fund listed on the Hong Kong Stock Exchange with the investment objective of tracking the performance of the *Hang Seng Tech Index*. The index covers the 30 largest tech companies listed in Hong Kong, including leading firms in internet, artificial intelligence, e-commerce, and fintech sectors. The entry cost is relatively lower compared to major tech stocks, making this type of ETF suitable for more conservative or less active investors.

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