Besides financials, transport and shipping stocks also stood to benefit. Hong Kong shipping giant Orient Overseas International has surged 77 per cent this month.

“Shipping companies’ share prices have made quite a strong recovery because there is quite a bit of demand. Investors anticipate economic recovery globally, so demand for that sort of transport service is strong,” said Tse.

“Transportation stocks such as MTR may also do well if the pandemic cools down a bit, and people go out.”

On the other hand, companies that benefited from the work from home trend, such as Weimob and Vobile with software-as-a-service (SaaS) as their core business, have been overbought, said Tse.

Cloud-based marketing provider Weimob has shot up more than 200 per cent this year, while Vobile Group, which provides online video content protection services, has soared 426 per cent since the start of 2020.

“They have a bright future, but their price has gone up too much. Forget about them and let them cool down a bit,” said Tse.

Commodity and energy producers have led the gains on the markets in the past year, with the two sub-gauges rising at least 13 per cent, while the measure tracking technology stocks slipped 1.1 per cent.

“As profits for more industries improve and the interest rate trends up, the odds are increasing that investing in low-valuation sectors will bring above-average returns,” said Zhang Xia, an analyst at China Merchants Securities. “The valuation gap between traditional industries and fledging industries will narrow.”

The brokerage forecasts 23 per cent full-year profit growth for China-listed companies in 2021, compared with a 2.2 per cent decrease this year.

“The pro-cyclical style will continue as China’s economy is entering the stage of active restocking, which will boost the flexibility of prices and profits of cyclical products,” said Wang Yi, an analyst at Great Wall Securities. “The outlook of the cyclical sector is more secure than that of growth stocks that are facing some headwinds.”

Goldman Sachs has added cyclical stocks to its Chinese equity portfolios, especially those that are favourably exposed to a likely recovery of consumer demand in China in the early part of next year, according to Kinger Lau, the investment bank’s chief China equity strategist.

The trend in Hong Kong and China is in line with a global rotation from growth stocks, such as technology and health care which have seen tremendous gains, into value stocks that have underperformed, according to Credit Suisse.

Sectors that have underperformed in 2020, like travel and leisure, energy and financials, could “potentially catch up to pre-virus levels” and outperform growth stocks in the coming six months, said John Woods, Credit Suisse’s chief investment officer for Asia-Pacific.

BlackRock has also positioned its equity portfolios for a “cyclical rebound”. The asset manager has trimmed holdings in health care and technology stocks in Asia as the risks of profit-taking sell-offs have risen, and instead bought out-of-favour stocks, including hard-hit travel stocks, and industrial and materials stocks in China, according to its 2021 Asia Investment Outlook report.

China has handled the pandemic very well, so the level of rotational buying in its equity markets may be limited compared to other developed markets, going forward, said Nicholas Chui, a portfolio manager in BlackRock’s global emerging markets equities team, during its investment outlook webinar.

He advised investors to be prepared to embrace the broader opportunities that may emerge when a coronavirus vaccine becomes available.

“A vaccine definitely gives a lot more hope, and it gives the trajectory of recovery even greater visibility beyond 2021,” Chui said.