The Hang Seng Index has been rising for many trading days since the beginning of 2024.

Hang Seng Technology's decline this year (although the first seven trading days) has surpassed that of the whole of last year. There has not been any mainstream capital market in history, and it has been growing for more than four and a half years.

At the end of the day: the market is short of money! Who will support the stock price is the most immediate topic at this stage.

Against the backdrop of the Federal Reserve maintaining high interest rates, OTC capital did not enter the market, and companies chose to buy back the Hong Kong stocks themselves on a large scale. HSBC Holdings and Tencent, which have the most weight in the Hong Kong stock market, are buying back almost every day. According to Wind data, in 2022 and 2023, the share repurchase amounts of Hong Kong listed companies were HK$104.830 billion and HK$125.935 billion, respectively, several times that of previous years. Among them, Tencent Holdings is an important force driving stock repurchases of Hong Kong listed companies to record highs. The total repurchase amount of Tencent Holdings for the full year of 2023 reached HK$48.429 billion, accounting for 38.46% of the total repurchases in the Hong Kong stock market.

US stocks have continued to rise, especially the Nasdaq Tech Index, which has been strong, all due to the recent temptation of Nvidia products. After Nvidia more than tripled in 2023, investors are still pushing up the company's stock price, a fact that the market still expects high demand for its chips used in artificial intelligence computing. According to collected data, Nvidia's revenue increased 206% in the third quarter and is expected to grow 232% in the fourth quarter.

Overnight, foreign brokerage firm Truist raised Nvidia's target price from $674 to $691. Prior to that, Nvidia launched three new desktop computer graphics products with additional components on Monday, which allow users to make better use of artificial intelligence on personal computers. In an interview on Tuesday, Nvidia Chief Financial Officer Colette Kress reiterated CEO Wong In-hoon's forecast that the company believes it can continue to grow in the 2025 calendar year, given that demand for AI-related products remains strong.

At this point, have you discovered that the market value of US technology companies is growing, and they generally rely on technological innovation+ performance. However, technology stocks with large market capitalization in Hong Kong stocks, especially the Hang Seng Technology Index series, are generally driven by business models. The Hang Seng Technology Index has dragged down Hong Kong stocks as a whole, and the corporate appeal is not strong. This is one of the main reasons why Hong Kong stocks have been sluggish for the past 4 years. The so-called “Hang Seng Technology Index” simply does not represent the rapid advance of Chinese technology; on the contrary, it has become a problem for Hong Kong stocks.

In the coming period, Hong Kong may be the only country where the “Hang Seng Healthcare Index” deviates from the Hang Seng Index. The performance of the past 7 trading days in 2024 is already very obvious.

Innovative drugs are increasingly being sold overseas, and the return on investment of many companies may be quite high in 2024. Everbright Securities pointed out that overall external demand for CXO is steady. Due to the more mature development of the overseas innovative drug industry, the transmission path of “macro factors → biomedical technology stock performance → investment and financing → CXO performance” is more rapid, and the warming of overseas financing in the third quarter of 2023 has led to an improvement in overseas CRO order indicators.

Recently, frequent mergers and acquisitions by multinational pharmaceutical companies have attracted market attention. From December 26, 2023 to January 9, 2024, in just 15 days, there have been at least 4 mergers and acquisitions in the global pharmaceutical market, involving leading global pharmaceutical companies such as AstraZeneca, Novartis, MSD, and Johnson & Johnson. It is worth noting that innovative pharmaceutical companies in China have appeared on mergers and acquisitions several times. Industry insiders generally believe that this shows that the R&D strength of local Chinese pharmaceutical companies has been recognized internationally. At the same time, it may also change the competitive landscape of the local pharmaceutical market.

Societe Generale Securities's January 5 research report pointed out that innovation+internationalization opens up room for growth in the pharmaceutical and biological industry. The global multi-center clinical progress and data readings of innovative drugs and innovative medical devices are worth continuing to track; the release of major products that have entered the commercialization stage of innovative drugs can be expected, and medical devices with “hard technology” capabilities will further open up the high-end overseas medical market. Exports of APIs, formulations, low consumption, core components and new order development are expected to accelerate; overseas innovation frontiers are also worth paying attention to. New demands such as weight loss and AD provide new momentum for the development of the industry and bring new business growth to China's innovation industry chain. Looking ahead to 2024, the “innovation+internationalization” development of China's pharmaceutical industry is expected to rise to a new height, and the main line of industry growth remains the same.

On January 9, luncanizumab was approved by the State Drug Administration to enter China to treat mild cognitive impairment and mild dementia caused by Alzheimer's disease. According to official information from Eisai Pharmaceutical Co., Ltd., the domestic price of luncanizumab, an innovative drug for Alzheimer's disease, is 2508 yuan per bottle [specification is 200 mg/bottle]. The annual cost of treatment is about 180,000 yuan.

Ping An Securities suggests seizing investment opportunities in the AD field from the three main lines of imaging diagnosis, peripheral blood diagnosis, and therapeutic drugs: 1) PET testing based on Aβ and TAU proteins has become the mainstream method of AD diagnosis, superimposing high barriers unique to nuclide drugs. It is recommended to focus on the corresponding PET developer leaders Dongcheng Pharmaceutical, China Tongzhu (01763), and Beilu Pharmaceutical, which lays out AI diagnostic software; 2) Peripheral blood marker testing technology continues to mature, and is expected to complement imaging diagnosis. It is recommended to focus on leading companies in the field of AD peripheral blood testing. BGI; 3 ) Various new targets, including Abeta, and improved dosage forms are expected to create a new pattern of AD treatment. It is recommended to focus on Hengrui Pharmaceutical, Xiansheng Pharmaceutical (02096), and related formulation company Jingxin Pharmaceutical, which are targets related to innovative Aβ drugs. The CITIC Construction Investment Research Report, on the other hand, is optimistic about domestic pharmaceutical companies with advanced layout and upstream CDMO companies with strong comprehensive strength, including the pharmaceutical industry.

Yesterday, the “People's Daily” review article pointed out that health insurance negotiations are negotiations with enterprises. They are definitely not “lower the price, the better” arbitrary bargaining, but rather seek maximum benefits for insured persons and at the same time empower the high-quality development of the pharmaceutical industry. From this perspective, the low reduction allows innovative drugs to be included in medical insurance, also for the best interests of insured persons, and can achieve a win-win situation for all parties. The market understands that the “bargain” model for collecting innovative drugs will weaken in the future.