Update | Hong Kong investors’ tails will be wagging in Year of the Dog as feng shui predicts solid year for Hang Seng Index
The annual CLSA ‘Feng Shui Index’ sees gains in pharmaceutical and consumer stocks but not for banks, and warns property investors to mind their flying stars
Investors in the Hong Kong stock market will have their tails up in the Year of the Dog, with the Hang Seng Index set for solid gains and pharmaceutical and consumers stocks a good bet, according to the annual “Feng Shui Index” compiled by Hong Kong-based broker CLSA.
The index, produced every year since 1992, takes a tongue-in-cheek look at the stock market based on the principles of feng shui, an ancient Chinese system of harmonising individuals with their surroundings. The index is regarded by many investors as an important informal indicator of Hong Kong stocks.
The coming year is the year of the earth dog, which represents duty, loyalty, defence and protection. This means investors should not be aggressive but prudent when making their investment decisions. Those born under the zodiac signs for the dog, rabbit and monkey will have a lucky year, but roosters, goats and dragons might have a rocky path.
“The enthusiastic earth dog jumps out of the kennel, tossing the fire rooster back to the barn and sending the Hang Seng Index skyward,” CLSA said.
The Hang Seng Index could have a great start, before pulling back in March. Through to the summer, the market “chases its tail and drops”, CLSA analysts said. In the second half, however, the index will have steady gains, before closing on a high at the end of the year. The Year of the Dog begins on February 16 this year.
From a feng shui perspective, sectors such as pharmaceuticals and consumer industries will be best performers in the upcoming year, as “the earth dog sees strong gains in wood-related industries overall”, the analysts said.