Shares forecast to roar back after weak start

Hong Kong stocks will be weak in the first half of the Year of the Wood Dragon - hindered by the outgoing Rabbit - but the market will turn around in July and August and remain at higher levels for the rest of the year, CLSA's Feng Shui Index 2024 predicts.

The annual index - which makes lighthearted predictions based on the debut of the Hang Seng Index in the Year of the Rooster in 1969 and the five elements of wood, fire, earth, metal and water - forecast that the benchmark will slide in March and rise in the second half of the year before a peak next January.

The weak market in the first half is because the Rabbit may stretch its tail and wrap the Dragon tightly around it, CLSA analysts said.

While predicting local stocks will end the year higher, they warned of volatility throughout the year as riding a Dragon is tumultuous at best.

Regarding industries, they noted that fire will succeed earth as the dominant element in a new cycle, meaning fire-related industries - such as technology and oil and gas - are likely to be auspicious over the next 20 years.

Earth-related sectors such as real estate and construction and wood-related industries, including health care, should also be good this year.

Water is the weakest of the five elements this year. Shipping and trade industries may encounter difficulties but are likely to remain busy.

For property investors, east and southwest are the best directions if they want to buy this year. The south and west are to be avoided, with caution given to the southeast.

Several personalities were mentioned in the outlook. OpenAI chief executive Sam Altman is expected to advance his career, but with the possibility of "sudden losses."

For Hong Kong movie star Maggie Cheung Man-yuk, who was born in the Year of the Wood Dragon, the outlook said she may continue to work if she wants but the age of 60 marks a break from the busy lifestyle of her youth.

caroline.zheng@singtaonewscorp.com