[ET Net News Agency, 23 December 2024] Last Friday (20th), the US stock market
rebounded, and this morning, the Asia-Pacific stock markets also generally performed well.
The Hang Seng Index opened higher this morning by over a hundred points, but the early
trading was volatile. After reaching a high of 19,924, the increase narrowed to just over
twenty points. The Hang Seng Index closed at 19,857 at midday, up 137 points or 0.7%, with
a turnover of nearly HKD 68 billion. The Hang Seng China Enterprises Index reported 7,195,
up 52 points or 0.7%. The Hang Seng Tech Index reported 4,466, up 21 points or 0.5%.

"Wan Kong Shing: Hang Seng Index is expected to fluctuate at the 20-day moving average in
the short term, China Mobile and HSBC are currently difficult to speculate on"

As the Hong Kong stock market approaches the holiday, the market remains quiet. With the
annual increase in US PCE in November lower than expected, the Hong Kong stock market only
rose by just over a hundred points at midday. Wan Kong Shing, the Chief Investment Officer
of iFAST Global Markets, told ET Net News Agency that with the holiday atmosphere, the
decline in the Hong Kong stock market will not be significant. He expects the Hang Seng
Index to fluctuate around 19600 to 20100 near the 20-day moving average for the remaining
time.
He pointed out that the current market trend leans towards trading stocks rather than
the market as a whole. The two main themes in the Hong Kong stock market recently are
"high dividend stocks" and "AI stocks," both of which have experienced some retracement.
Dividend stocks have always been a favourite among Hong Kong stock investors, focusing on
stability. However, with China Mobile (00941) and HSBC Holdings (00005) currently trading
at high levels, there isn't much room for speculation at current prices.

"Baidu's AI and autonomous driving have low realization rates, and SenseTime's development
is similarly lagging"

Regarding the AI sector, it was reported last week that Apple is suspected of "changing
course" to negotiate the placement of AI from Tencent (00700) and ByteDance into future
China versions of the iPhone, boosting Tencent and its ecosystem's Weimob (02013) stock
prices. On the contrary, Baidu (09888), which has been rumoured to have been in talks with
Apple, is speculated to be left out. Its stocks fell.
Wan Kong Shing mentioned that Baidu's stock price surged to a high of HKD 120 earlier
but then fell back. The market generally has low expectations for the company's
performance, primarily due to the slow development of its AI division, ERNIE Bot, which is
expected to struggle to contribute to profits. The taxi service sector with better
development in autonomous driving, "Apollo Go" is still in a phase of low-price market
expansion, making profit prospects slim. Therefore, he believes that there is limited
upward potential for its stock price, with an initial significant resistance expected at
HKD 88. He added that AI development is hard to replicate, requiring substantial
resources, making short-term profit expansion difficult.
Another AI leader, SenseTime (00020), recently completed restructuring to focus on AI
generation. However, Wan Kong Shing remains bearish, believing that the company's
commercialization is slow, and it is not a good idea to buy it now.

"Kingsoft Cloud holding steady at HKD 4.5 for follow-up, Weimob may retrace by 10-20%"

Conversely, second-tier AI stocks have shown strength recently, similar to Weimob
benefiting from the hype driven by WeChat's gifting feature, rising by 80% in three days.
Wan Kong Shing expects that although Weimob has been hyped, its stock price may not
retrace significantly as the market believes its Tencent background provides support. He
predicts that the maximum resistance will be at HKD 3, with an expected retracement of
about 10-20% to find initial support around HKD 2.3. Investors can see if it can attract
more funds for follow-up.
Additionally, Kingsoft Cloud (03896) has also shown strength, which Wan Kong Shing
attributes to its association with Xiaomi (01810). With products under "Lei Jun" showing
promising results, the market anticipates that Kingsoft Cloud, chaired by Lei Jun, will
benefit from Xiaomi's AI development. He expects Kingsoft Cloud to continue to perform
well, with resistance around HKD 5, but a stable level at HKD 4.5 could lead to further
upward momentum.