Core Viewpoint - Tencent Music (TME.US) shows a pre-market increase of 1.69%, reaching $16.88, amid concerns about competition for light music users, but the company is expected to perform well in monetizing moderate to heavy users and generating new revenue from events and merchandise [1] Group 1: Market Performance - The closing price on January 7 was $16.60, reflecting a decrease of 5.74% [1] - The pre-market price on January 8 was $16.88, an increase of $0.28 or 1.69% [1] - The opening price was $17.38, with a highest price of $17.43 and a lowest price of $16.60 [1] Group 2: Analyst Ratings - Daiwa issued a report indicating short-term concerns about competition but remains optimistic about the company's monetization capabilities [1] - Morgan Stanley analyst Yang Liu maintained a "buy" rating for Tencent Music and raised the target price from $18 to $27.5 [1] Group 3: Financial Metrics - The total market capitalization of Tencent Music is $25.712 billion [1] - The price-to-earnings (P/E) ratio is 16.73 (TTM) and 27.39 (static) [1] - The total shares outstanding are 1.549 billion, with a circulating value of $8.974 billion [1]

Core Viewpoint - Daiwa's report indicates that Tencent Music (01698) is currently valued at a forecasted price-to-earnings ratio of 18 times for 2026, which is considered attractive, leading to an upgrade of the company's rating from "Outperform" to "Buy" [1] Group 1 - The company is expected to have strong monetization capabilities for moderate to heavy users [1] - New revenue sources are anticipated from events and merchandise [1]

Core Viewpoint - Daiwa has upgraded Tencent Music Entertainment Group (01698) from "Outperform" to "Buy," citing an attractive valuation equivalent to an 18x forecasted price-to-earnings ratio for 2026 [1] Group 1 - The company is expected to have strong monetization capabilities for moderate to heavy users [1] - New revenue sources are anticipated from events and merchandise [1]

Market Overview - On January 7, U.S. stock markets experienced significant volatility, with the Dow Jones Industrial Average dropping 466 points, a decline of 0.94%, closing at 48,996.08 points [4] - The market initially showed optimism with a high opening but faced a sharp decline towards the end of the trading session, reflecting a shift in investor sentiment from anticipation of interest rate cuts to concerns over tightening policies [4] Federal Reserve Commentary - Recent statements from Federal Reserve officials have dampened expectations for interest rate cuts in 2026, with officials indicating that the current policy is close to "neutral" and that the space for rate cuts is limited [4] - Key economic indicators, including a slower pace of inflation decline and a strong labor market, have contributed to the Fed's cautious stance, reducing the likelihood of a rate cut in March [4] Chinese Assets Performance - In contrast to the U.S. market, Chinese assets showed strong performance on January 7, with several Chinese concept stocks experiencing significant gains, including a 70.83% increase in Zhongchi Chefu and a 28.53% rise in 3ENetwork Technology [5] - The Hong Kong ADR index also saw a positive trend, closing at 23,246 points, up 174.04 points, with major stocks like Tencent and HSBC contributing to the upward movement [5]

Core Viewpoint - Daiwa's research report indicates that while there are short-term concerns regarding competition for Tencent Music's light music users, the company is still viewed positively for its monetization capabilities among moderate to heavy users, as well as new revenue sources from events and merchandise [1] Group 1 - Daiwa believes Tencent Music's current valuation corresponds to a forecasted price-to-earnings ratio of 18 times for 2026, which is considered attractive [1] - The rating for Tencent Music has been upgraded from "Outperform" to "Buy" [1] - The target price has been adjusted down from HKD 91 to HKD 82 to reflect the trend of valuation adjustments among peers [1]

Group 1 - The Hang Seng Tech Index has declined by 2.3%, indicating a broader downturn in the technology sector in Hong Kong [1] - Tencent Music has dropped over 5%, while Alibaba and BYD have seen declines exceeding 4% [1] - Other companies such as NIO, Bilibili, Xiaopeng Motors, Kuaishou, and Li Auto have all fallen by more than 3%, with Tencent, Meituan, NetEase, and SMIC experiencing declines of over 2% [1]

Core Viewpoint - The Hong Kong technology sector is experiencing a significant decline, with the Hang Seng Technology Index dropping by 2.3% [1] Group 1: Stock Performance - Tencent Music has seen a decline of over 5% [1] - Alibaba and BYD have both dropped by more than 4% [1] - NIO, Bilibili, Xpeng Motors, Kuaishou, and Li Auto have all decreased by over 3% [1] - Tencent, Meituan, NetEase, and SMIC have fallen by more than 2% [1]

Group 1: Market Performance - The U.S. stock market saw all three major indices rise, with the Dow Jones Industrial Average reaching a new historical high, approaching the 50,000 mark, closing at 49,462.08 points, up 0.99% [3] - The Philadelphia Semiconductor Index increased by 2.75%, setting a new historical high, with notable gains in chip stocks such as Microchip Technology up over 11%, Micron Technology up over 10%, and NXP Semiconductors up over 9% [5][6] Group 2: Federal Reserve Insights - Federal Reserve Governor Milan stated that the Fed should lower interest rates by more than 100 basis points this year, as economic data trends may support further rate cuts [5] - Milan noted that core inflation has returned to around the Fed's 2% target, and he expects strong economic growth in the U.S. this year [5] Group 3: Commodity Prices - Silver prices surged again, with COMEX silver futures breaking the $80 per ounce mark, reflecting a rise of approximately 6% [8] - Gold prices also saw a slight increase, with COMEX gold futures surpassing $4,500 per ounce, up over 1% [8]

Core Viewpoint - China Weitong (601698.SH) issued a risk warning, indicating that its stock price has significantly outperformed the market, raising concerns about potential irrational speculation and market overheating [1] Group 1: Stock Performance - As of January 6, 2026, the company's stock closed at the daily limit price, with a cumulative increase of 108.64% since December 3, 2025 [1] - During the same period, the Shenwan Military Industry sector rose by 23.92%, and the Shanghai Composite Index increased by 5.31%, highlighting the company's stock's superior short-term performance compared to both the industry and the index [1] Group 2: Market Risks - The company noted a significant "hot potato" effect in trading, indicating high trading risks and the potential for a sharp decline in stock price [1] - The stock price is currently at a historical high, which has deviated significantly from the company's fundamentals, suggesting a risk of substantial short-term price drops [1] - Investors are advised to be cautious of secondary market trading risks and to make rational investment decisions [1]

Market Performance - Major US stock indices closed higher, with the Dow Jones reaching a record high, driven by strong gains in financial stocks [1][3] - The Dow rose by 594.79 points, or 1.23%, closing at 48,977.18 points; the Nasdaq increased by 160.19 points, or 0.69%, to 23,395.82 points; and the S&P 500 gained 43.58 points, or 0.64%, ending at 6,902.05 points [3] Sector Performance - The S&P 500 energy sector index rose by 2.7%, with major stocks like ExxonMobil and Chevron seeing significant increases due to military actions in Venezuela [5] - The S&P 500 financial sector index increased by 2.2%, with both Goldman Sachs and JPMorgan Chase rising over 3% and reaching all-time highs [6] Technology Stocks - Most large-cap tech stocks saw gains, with Tesla up 3.10%, Amazon up 2.9%, and Meta up 1.29%. However, Microsoft fell by 0.02%, Nvidia dropped by 0.39%, and Apple decreased by 1.38% [3][4] Cryptocurrency and Related Stocks - Cryptocurrency-related stocks experienced a rise, with Strategy stock increasing nearly 5% and Coinbase surging by 7.8% as Bitcoin prices hit a three-week high [6] Chinese Stocks - The Nasdaq Golden Dragon China Index rose by 0.49%, with notable gains in stocks like Beike up over 6% and Bilibili and Tencent Music each up over 3% [6]