Xin Lang Cai Jing·2026-01-29 01:21Core Viewpoint - The disturbances affecting the Hong Kong stock market have subsided, and a spring rally is anticipated to continue into February 2026, with large-cap stocks expected to outperform before the Lunar New Year, while growth sectors supported by policy directions are likely to perform better overall [1][6]. Group 1: Market Conditions - The downward adjustment of earnings expectations for major Hong Kong indices has slowed since the end of 2025, indicating that the fundamental disturbances have passed [2][13]. - The upcoming earnings reports for Hong Kong stocks are expected to be concentrated from late March to early April, marking a period of fundamental stability [2][13]. - The market's focus is expected to shift back to domestic policies and the fundamentals of listed companies, with significant attention on the spring rally and the "14th Five-Year Plan" policy expectations [2][13]. Group 2: Spring Rally Characteristics - Historically, the average return of the Hang Seng Index during the spring rally from 2015 to 2025 was 2.4%, with an average weekly win rate of 70.8% [3][14]. - Notable years for the spring rally included 2019, 2021, and 2023, with average gains of 10.6%, while 2016 and 2024 saw declines of 12.0% and 7.6% respectively due to market conditions [3][14]. - The spring rally in Hong Kong typically occurs in January, contrasting with the A-share market, which sees its rally more concentrated in February [3][14]. Group 3: Investment Focus Areas - The short-term investment focus should include three main lines: 1) sectors aligned with the "14th Five-Year Plan" such as biomanufacturing, embodied intelligence, and 6G technology; 2) platforms and real estate benefiting from policy-driven expectations; 3) non-bank financials that are likely to benefit from the spring rally [5][6][16]. - The "14th Five-Year Plan" and the Central Economic Work Conference are expected to guide industry development directions, highlighting opportunities in strategic emerging industries like new energy, aerospace, and quantum technology [4][15].