Hong Kong stocks are poised for a bumpy start to the Year of the Horse after a slew of macroeconomic data showed further weakness in the mainland economy. The Chinese calendar flipped over last Friday, ushering out the Year of the Snake which saw a paltry 5 per cent rise in the city's benchmark Hang Seng Index. The Hong Kong stock market reopens today after the four-day Lunar New Year holiday. Downbeat data from the mainland, including a sharp fall in the service and manufacturing purchasing manager indices for January, prompted fresh concerns about the state of the economy and the growth outlook. China's service sector fell to a five-year low in January after the manufacturing sector eased to a six-month low for the same period, leading to a sluggish start this year on the back of a liquidity squeeze in the interbank system. Adding to the gloomy mood is news that Japanese stocks, which surged over 50 per cent last year fuelled by the country's bond-buying programme, finished at a 10-week low amid lingering fears over emerging markets. Emerging market stocks and currencies were under mounting pressure after jittery investors started to withdraw their capital and redeploy it into Europe and the US, partly in anticipation the US Federal Reserve will complete its exit from its bond-buying programme by the end of this year. Investors continue to increase their European-focused ETF holdings before the next interest rate decision by the European Central Bank and Bank of England, said analysts at Markit, a London-based data provider. For the eighth week, outflows were seen from Hong Kong's equity funds, with the amount hitting US$691 million in the week ending January 29, according to US brokerage firm Jefferies. "For Asia Pacific equities, selling was seen among foreign and mutual fund/ETF investors," Jefferies said in a research note. "[The] latest selling was indeed broad-based with India, Indonesia, Japan, Korea, the Philippines, Taiwan and Thailand all experiencing selling from both foreign and mutual fund or ETF investors." On a brighter note, CLSA, a broker owned by mainland financial giant Citic Securities, said in its widely watched annual Feng Shui forecast that the Hang Seng will rise from January 31 to the end of July as the element of fire should bode well for the city's stock market. The tongue-in-check gauge suggested investors focus on internet, technology, telecommunications, and entertainment. History is not a guide though. In the last Year of the Horse in 2002, the Hang Seng disappointed as it declined 14 per cent.