Market Overview - The US labor market remains resilient, with the unemployment rate marginally decreasing to 4.4% in December 2025[4] - The 10-year US Treasury yield recorded 4.18%, down 1 basis point this week, while the US dollar index rose by 0.69% to 99.1[15] - Gold prices increased by 3.68% and oil prices surged by 3.74% due to geopolitical tensions and sanctions on Russian oil[4] Asset Correlation and Inflation - The long-term correlation between US stocks and bonds has slightly declined since 2025, with expectations of continued low inflation in 2026[10] - If geopolitical factors lead to a significant rise in oil prices, the correlation may remain high, undermining the hedging effectiveness of US bonds against stocks[10] Global Fund Flows - Global funds saw a significant outflow of $12.07 billion from US equity funds and a substantial inflow of $14.18 billion into US fixed-income funds[4] - Chinese stock markets attracted capital inflows, particularly in materials, communications, and healthcare sectors[4] Valuation Metrics - As of January 9, 2026, the Shanghai Composite Index's valuation exceeded that of the S&P 500 and CAC 40, reaching 93.2% of its historical percentile[4] - The risk-adjusted return percentile for the S&P 500 rose to 60%, while the Nasdaq's increased from 37% to 46%[4] Economic Indicators - The market is pricing in a 95.60% probability that the Federal Reserve will not cut interest rates in January 2026[4] - Upcoming key economic indicators include the US inflation data for December 2025[4] Risk Considerations - Short-term asset price fluctuations may not reflect long-term trends, and there is a risk of deeper-than-expected economic recession in Europe and the US[4]

Market Overview - The A-share market showed a strong upward trend last week, with the Shanghai Composite Index rising by 3.82%, marking a 15-day consecutive increase, and significant growth in market trading volume [1][8] - The STAR 50 Index led the major indices with a 9.80% increase, while the CSI 500 and CSI 1000 indices also recorded over 7% gains, indicating that technology and small-cap growth sectors are the main market drivers [1][11] - In contrast, large-cap value sectors saw modest gains, with the CSI Dividend Index only increasing by 1.61%, highlighting ongoing structural differentiation in the market [1][11] Industry Performance - All major sectors in the market experienced gains last week, with the telecommunications services sector leading at 12.04%, benefiting from the development of 5G and the digital economy [1][11] - The healthcare sector rose by 7.64%, driven by aging demographics and innovation [1][11] - The financial sector had the smallest increase at 0.41%, influenced by interest rates and regulatory factors, while the overall market showed a preference for technology growth, with traditional industries lagging behind [1][11] Fund Issuance and Performance - A total of 11 funds were issued last week, including 5 equity funds, 2 mixed funds, 1 bond fund, and 3 FOF funds, with a total issuance of 8.191 billion units [1][19] - The Wind All Fund Index rose by 2.65%, with the ordinary equity fund index increasing by 5.26% and the equity mixed fund index rising by 4.79%, indicating strong performance in equity funds [1][6] - Bond funds showed a slight increase of 0.28%, while equity funds performed robustly, reflecting a strong market sentiment [1][6]

Group 1 - The core point of the article indicates that the U.S. labor market showed signs of cooling in 2025, with a notable slowdown in job growth and a decrease in the unemployment rate to 4.4% in December, down by 0.2 percentage points month-over-month [1] - In December 2025, the U.S. added 50,000 non-farm jobs, with an annual total of 584,000 jobs added for the year, averaging 49,000 jobs per month, which is significantly lower than the 2 million jobs added in 2024, averaging 168,000 jobs per month [1] - The employment growth in December 2025 was primarily driven by the restaurant services, healthcare, and social assistance sectors, while retail employment saw a decline [1] Group 2 - The average hourly wage for private sector non-farm employees increased by $0.12 to $37.02 in December, reflecting a year-over-year growth of 3.8% [1] - The U.S. Labor Department revised the non-farm employment data for October and November 2025, indicating a downward adjustment of job losses from 105,000 to 173,000 in October and a reduction in job gains from 64,000 to 56,000 in November, totaling a decrease of 76,000 jobs over the two months [1] - Economists suggest that while the pace of job growth in 2025 has slowed, it also signals a trend towards stability, which may influence the Federal Reserve's decisions regarding interest rate cuts [2]

Group 1 - The core viewpoint is that the U.S. job growth in December is described as "moderate," indicating a reluctance among businesses, outside of healthcare and AI-related sectors, to hire [1] - The low hiring environment is consistent with feedback from companies, attributed to uncertainty and productivity issues [1] - There is a notable lack of discussions about hiring among businesses outside the AI ecosystem and healthcare sectors [1]

Core Viewpoint - The overall market is experiencing an upward trend, with the index approaching a rating of 3.90 stars, indicating a potential for further growth in the near future [1]. Group 1: Market Performance - All market segments, including large, medium, and small-cap stocks, have seen increases, with small-cap stocks showing the most significant gains [2]. - The CSI 1000 and 2000 indices are now considered overvalued, while the CSI 500 and low-volatility indices are quickly approaching overvaluation [2]. - Since 2018, the CSI 500 low-volatility index has nearly doubled, driven by valuation increases, profit growth, and low-volatility rebalancing [2]. Group 2: Market Phases and Trends - The current bull market is characterized by structural trends, where not all sectors rise or fall together, indicating a rotation in market styles [2]. - The A-share market has seen a significant increase of over 60% since September 2024, with three notable upward waves contributing to a total rise of approximately 74% [2][3]. - Market liquidity is a key driver of the current upward trend, influenced by the Federal Reserve's interest rate cuts and the overall global liquidity environment [3][5]. Group 3: Liquidity Factors - The Federal Reserve's anticipated interest rate cuts through 2026 are expected to maintain a favorable liquidity environment [5]. - A significant amount of deposits, approximately 30 trillion yuan, is set to mature in 2026, with a portion likely to flow into financial assets, including stocks [8][10]. - The current low interest rates on deposits are expected to redirect some funds into the stock market, although not all will enter equities [10][11]. Group 4: Corporate Earnings Growth - Corporate earnings are recovering, with a notable increase in profits for the technology sector, which is leading the market [17][18]. - Some sectors, such as consumer goods, are still experiencing declines in earnings, indicating a mixed performance across different industries [20]. - Continuous monitoring of corporate earnings growth will be essential in 2026 to gauge market expectations [21][22]. Group 5: Investment Strategy - As the market approaches a rating of 3.90 stars, the optimal phase for stock fund investments may have passed, suggesting a shift towards asset allocation and profit-taking strategies [23][24]. - The focus for 2026 should be on managing asset allocation rather than aggressive stock fund purchases [24]. Group 6: Hong Kong Market Insights - The Hong Kong market has also returned to a rating of 3.90 stars, with updated valuations provided for various indices [25]. - The valuation table for Hong Kong indices includes metrics such as P/E ratios and dividend yields, offering insights for potential investors [26].

Core Viewpoint - The U.S. non-farm employment growth in December fell short of expectations, with significant downward revisions to the previous two months' data, leading to the weakest annual employment growth since the pandemic began [1][3]. Employment Data Summary - The Bureau of Labor Statistics reported that October's non-farm employment was revised from a loss of 105,000 to a loss of 173,000, and November's from an increase of 64,000 to an increase of 56,000, resulting in a total downward revision of 76,000 jobs for November and December combined [3]. - For the entire year, U.S. non-farm employment increased by 584,000, marking the weakest annual growth since the sharp decline of 9.2 million jobs in 2020 due to the pandemic [3]. - The three-month moving average of employment data has entered negative territory, indicating a significant decline in labor market momentum [1][4]. Unemployment Rate Insights - Despite the disappointing employment data, the unemployment rate decreased to 4.4%, which was better than the expected 4.5% and the previous 4.6% [9]. - The decline in the unemployment rate is partly attributed to a shrinking labor force participation rate, suggesting that some unemployed individuals have exited the labor market entirely [3]. Sector-Specific Employment Trends - Private sector employment growth remains weak, with manufacturing jobs continuing to decline. The healthcare sector added 21,000 jobs, although this is below the average monthly increase of 34,000 jobs seen last year [5]. - Analysts predict that in 2025, private sector employers will add an average of 61,000 jobs per month, the weakest level of growth since 2003 without an economic recession [5]. Wage Growth Analysis - Average hourly earnings increased by 0.3% month-over-month, with the previous value revised to 0.2%. Over the past 12 months, wages have grown by 3.8%, outpacing inflation by approximately 1 percentage point [7]. Interest Rate Expectations - The report has dispelled market expectations for a Federal Reserve rate cut in January, as the decline in the unemployment rate is seen as a key factor supporting the Fed's patience [8]. - The likelihood of a rate cut in January is currently viewed as zero, despite the weak employment data and downward revisions [2][8].

Core Insights - The U.S. non-farm employment growth in December was below expectations, with a total increase of 50,000 jobs compared to the forecast of 65,000 jobs, marking the weakest annual performance since the pandemic [1] - The unemployment rate in December was reported at 4.4%, slightly better than the expected 4.5% [1] - The total non-farm employment increase for the year was 584,000, the weakest annual growth since the significant job losses during the COVID-19 pandemic [3] Employment Data - The October non-farm employment figure was revised down from a loss of 105,000 to a loss of 173,000, while November's figure was adjusted from an increase of 64,000 to an increase of 56,000, resulting in a total downward revision of 76,000 jobs for November and December combined [1][3] - The three-month moving average employment data has entered negative territory, indicating a significant decline in labor market momentum [1][3] Sector Performance - The private sector showed weak employment growth, with manufacturing jobs continuing to decline [3] - The healthcare sector was a primary driver of job creation, adding 21,000 jobs, although this was below the average monthly increase of 34,000 jobs in 2023 [3] Wage Growth - Average hourly earnings increased by 0.3% month-over-month, with the previous value revised to 0.2% [4] - Over the past 12 months, wages have grown by 3.8%, outpacing inflation by approximately 1 percentage point [4] Market Reaction - Following the employment data release, U.S. stock futures saw a short-term rise, with the Nasdaq futures up by 0.43%, S&P 500 futures up by 0.33%, and Dow futures up by 0.28% [5] - U.S. Treasury bonds fell, and the dollar index experienced a short-term decline [5] - Spot gold prices rose, reaching $4,490 per ounce, with a daily increase of 0.30% [6]

Core Viewpoint - The Hong Kong IPO market experienced a strong resurgence in 2025, with 114 companies completing listings and raising a total of 285.3 billion HKD, a 224% increase from 88.1 billion HKD in 2024, making it the largest IPO fundraising exchange globally [1][9]. Industry Analysis - The fundraising distribution in the Hong Kong IPO market shows a clear structural characteristic, with significant differences in financing vitality and capital preferences across different sectors, highlighting the importance of understanding the market ecology [1][9]. - The top five industries—Industrial, Information Technology, Consumer Discretionary, Materials, and Healthcare—accounted for 90% of the total fundraising, raising a combined 260.2 billion HKD, demonstrating the strong appeal of core sectors to investors [1][9]. Major Fundraising Projects - Notably, the largest IPO projects in these five industries came from well-known companies, including CATL, which raised 41.0 billion HKD, and SANY Heavy Industry, which raised 15.3 billion HKD through A to H listings [3][11]. - The fundraising landscape changes significantly when excluding established companies, revealing that the top three industries for new entrants are Consumer Discretionary, Information Technology, and Healthcare, which collectively raised 72.5 billion HKD, representing 81% of the total for new entrants [4][12]. Sector Highlights - The Consumer Discretionary sector led the new entrants with a total fundraising of 30.2 billion HKD, driven by key players like Chery Automobile, which raised 10.4 billion HKD [6][14]. - The Information Technology sector also performed well, with 20 new entrants raising a total of 21.8 billion HKD, benefiting from the rise of robotics and artificial intelligence [6][14]. - The Healthcare sector raised 20.5 billion HKD, with 16 unprofitable biotech companies completing IPOs, accounting for 65% of the sector's total fundraising, showcasing the sector's potential as a financing platform for innovative medical enterprises [6][14]. Market Preferences - The distribution of industry fundraising aligns with market capital preferences, where established industries attract long-term capital due to stable profitability, while new sectors like Consumer Discretionary, Information Technology, and Healthcare are favored for their high growth potential [7][15].

Group 1 - Several banks have launched large-denomination certificates of deposit (CDs) for 2026, with over 30 banks announcing issuance by January 7, 2026 [1] - Some banks have seen three-month short-term CD rates drop below 1%, aligning closely with regular fixed deposit rates, such as Yunnan Tengchong Rural Commercial Bank offering a rate of 0.95% for a 0.1 billion yuan issuance [1] - The Ministry of Finance announced the cancellation of VAT export tax rebates for photovoltaic products starting April 1, 2026, and a reduction in the rebate rate for battery products from 9% to 6% until the end of 2026 [1] Group 2 - The China Passenger Car Association reported that retail sales of new energy passenger vehicles in China reached 1,280.9 million units in 2025, marking a 17.6% year-on-year increase [2] - The average price of sulfuric acid in Shandong province rose by 147.43% year-on-year in 2025, reaching a ten-year high, with expectations of price fluctuations in 2026 [2] Group 3 - The global semiconductor sales reached $75.3 billion in November 2025, a 29.8% increase from November 2024, marking a historical high [4] - The global humanoid robot market is expected to see a total shipment of 13,000 units in 2025, with a Chinese company, Zhiyuan, leading the market with a 39% share [4] Group 4 - Mining giants Rio Tinto and Glencore have resumed merger talks, potentially creating a mining giant valued over $260 billion amid rising copper demand driven by energy transition and AI [5] - The price of copper futures recently surpassed $13,000 per ton, reflecting the increasing demand and limited supply, with S&P warning of rising global copper shortage risks [5] Group 5 - Apple is reportedly accelerating the selection process for a new CEO, with John Ternus, the current Senior Vice President of Hardware Engineering, emerging as a leading candidate [6] - Google Cloud's marketing VP, Alison Wagonfeld, is set to join NVIDIA as Chief Marketing Officer at the end of January [6] Group 6 - The China Securities Regulatory Commission approved Changyu Group's IPO registration for listing on the Shanghai Stock Exchange [8][9] - Guangkang Biochemical received a warning letter from the Guangdong Securities Regulatory Bureau for not adequately disclosing the risks associated with the use of raised funds for cash management [10] Group 7 - Key Kai Technology announced that a major shareholder plans to reduce their stake by up to 3% within three months [11] - China First Heavy Industries reported minimal revenue from related projects, despite being listed as a controllable nuclear fusion concept stock [12] Group 8 - Wan Tong Development expects to report a net loss for the fiscal year 2025 [13] - Huisheng Biological anticipates a net profit of 235 million to 271 million yuan for 2025, recovering from a loss in the previous year [15] - Wanfu Biological forecasts a significant decline in net profit for 2025, estimating a drop of 87.71% to 91.81% [16] Group 9 - Daotong Technology expects a net profit increase of 40.42% to 45.10% for 2025 [17] - China Shipbuilding Defense anticipates a substantial net profit increase of 149.61% to 196.88% for 2025 [18] Group 10 - Shenzhen Gas reported a slight decline in net profit of 3.45% for 2025, despite a revenue increase of 5.11% [20] Group 11 - Debon Holdings announced that its stock will continue to be suspended from trading due to significant matters being planned by its indirect controlling shareholder [21] Group 12 - The Shanghai Composite Index rose by 0.92%, surpassing 4100 points, with a total trading volume exceeding 3 trillion yuan, marking a significant market activity [22]

Core Viewpoint - The article argues that despite criticisms, Hong Kong remains a strong contender in attracting talent and investment, particularly through its education, healthcare, and financial systems [1][2]. Group 1: Education - Hong Kong's education system offers significant advantages, with a high acceptance rate into top universities, where local students have a 38.2% chance of admission to prestigious institutions [8]. - The DSE examination serves as a "universal ticket" for students, recognized by over 165 universities in mainland China and more than 1,000 globally, including top-tier schools like Oxford and Cambridge [9]. - The "Overseas Chinese Student Examination" provides an easier pathway for students with average scores, with a much lower difficulty level compared to mainland China's college entrance exam [10][12]. Group 2: Healthcare - Hong Kong boasts a high life expectancy of 85.3 years, ranking first globally for seven consecutive years, supported by a world-class healthcare system [17]. - The city has superior cancer treatment statistics, with a breast cancer five-year survival rate of 89.8%, the highest in the world [22]. - Access to healthcare is affordable, with public hospital stays costing only 100 HKD per day for permanent residents, covering various medical services [20]. Group 3: Wealth and Career Opportunities - Hong Kong's tax system is simple and transparent, lacking capital gains tax and inheritance tax, making it an attractive destination for businesses and high-net-worth individuals [23][24]. - Companies can save significant amounts on taxes, with a corporate tax rate of 16.5%, compared to 25% in mainland China, leading to substantial savings for profitable businesses [25]. - The personal income tax rate is capped at 17%, with many deductions available, resulting in effective tax rates often below 10% for dual-income families [30].