Approaching Chinese New Year, I wish everyone good health and prosperity! The claws of the tiger have already extended to the world before it arrives. Russia continues to deploy troops in Ukraine. After annexing the Crimea Peninsula in 2014, the claws again extended to Ukraine. Russia thinks there is a pro-Western country on the border, so this should be the main reason to overthrow the Ukrainian government by force. It is a pity that US President Biden's reaction clearly showed his weakness, giving Russia the "trump card" that the US will not interfere with force, so the situation is passive. Weak-kneed diplomacy is more likely to lead to war. History readers can probably point out that the ambitions of Nazi Hitler and the appeasement policies of Britain and France were the reason for the Second World War. The US president is a model of the British Prime Minister Chamberlain. On the contrary, many winners of the Nobel Peace Prize are "ruthless" and not easily compromised, such as former Israeli Prime Minister Rabin, former Palestinian Autonomous Government Chairman Arafat and Secretary of State Henry Kissinger etc. If Ukraine is strong enough, the Russian army cannot easily threaten. "Stop fighting to fight" does not mean to put away all weapons. Of course, we should easily use force. If you use it, the prerequisite is to have it!

As a result, the White House hurried to clarify and adopted a tougher stance. At the time of writing, in addition to sending additional resources there, the United States had withdrawn their diplomats and began to put a small number of soldiers to be on alert. Therefore, the recent trend of U.S. stocks has weakened rapidly. The Dow fell sharply from the historical high of 36,952.53 at the beginning of the year to 34,364.50 at the time of writing. While the Nasdaq 100 index, is more closely related to the economic cycle. Once fell to 13,724.85, to 14,509.58 at the time of writing, compared with the high of 16,764.85 in the 52 weeks. It has fallen nearly 14%. In terms of cryptocurrencies, under the expectation of the Fed raising interest rates, assets are facing a sell-off (the former does not have the characteristics of generating cash flow), and it is even more panic. Bitcoin has fallen below $40,000 to nearly $35,000. The author believes that the trend of U.S. stocks in February is still not optimistic. The valuation is high, and the situation is not good either. We should consider shifting to others or even turning it into cash. The MPF portfolio contains lots of US stock funds and is recommended to switch to more conservative funds, or areas away from war storms are more suitable. Although Japan is in the middle of the US-Russian forces, as it has no military, the chances of being involved are not high. The Nordic region has always been neutral and an ideal short-term investment destination. 

The Hong Kong stock market finally got off to a good start in January this year. As predicted last month, "there is still an opportunity to test the earlier low of 22,665 and create a double bottom." As a result, the Hang Seng Index once hit a new low of 22,709, but the trend improved after creating a double bottom on the monthly chart. It peaked at 24,982 and stated at 24,100 while the time of writing, above the 23,873 of MA20. The situation is improving when the Chinese New Year is approaching. It is worth noting that the trend of traditional Hong Kong stocks is more favourable than that of mainland stocks. Many local stocks have hit new highs (such as HSBC 0005, BOC Hong Kong 2388) or are close to the one year high. Readers who followed my advice from dipping into the market last month. It is prepared to raise, but don't be too aggressive. For the time being, in terms of industry, the traditional economic stocks are still preferred, especially the bursting of the bubble in US technology stocks, which cannot support the valuation of mainland "unicorns", so it is better to stay away from it. 

Although Chow Sang Sang (0116) which was introduced last month, did not advance to the mid-line target of 12.18 yuan. The trend still has also improved significantly. It once reached a high of 11.3 yuan, and it rose above 11 yuan to 11.12 yuan at the time of writing. The United States is still plagued by inflation problems. And the price of gold continues to remain strong. Expecting that the short-term trend is still positive. In addition, its valuation is fair, and the downside is limited. Recommended keeping to hold. 

In the coming month, the author introduces First Pacific (0142), the company mainly engaged in investment holding, the main asset of which is Indofood, the manufacturer of Indomie, and owns PLDT, a leading telecom company in the Philippines, and MPIC, and infrastructure operating company. Indomie is one of the most famous instant noodle brands in the world, and because of its halal certification, it has a near-monopoly in Muslim regions. Indofood entered the Arab market after the acquisition of Pinehill, with the potential to grow big. The other business of First Pacific is very cyclical. The group earned US$181 million in the first half of the year, which is nearly 90% of the previous full year. Expecting that it will earn more than 350 million US dollars in 2021, relative to the current market value of 12.75 billion Hong Kong dollars (about 1.65 billion US dollars). The expected price-earnings ratio in 2021 is 5 times, and the expected interest rate is more than 5%. If the changes in the share prices of the major holding companies of First Pacific take into account. The net assets of First Pacific are expected to reach US$0.945 (about HK$7.37) by the end of last year. Furthermore, the company is one of the few companies in Hong Kong whose main business income comes from non-Hong Kong and mainland China and is less sensitive to the economy of China and Hong Kong. Therefore, it will also help to reduce the volatility of the investment portfolio. It is worth holding in the middle line, first look up to last year's high of 3.3 yuan, and you can make further bets after the breakthrough.

Kay Ho (CE No.: ANV293)

Acer King Capital Hong Kong Limited

Statement: The author is a licensee of the 1st, 4th, and 9th types of licenses of Securities and Futures Commission, SFC. Acer King securities Limited and Acer King Capital Hong Kong Limited are affiliated companies of Hantec Group and were invited to contribute articles in Hantec Group's monthly newsletter. The writing does not represent the position of Hantec Group. As the author does not personally hold the above-mentioned shares, investors should exercise caution when buying or selling relevant securities and investment instruments.