At the time of writing, we are on the first day of the Chinese New Year of the Snake. My annual ritual is to write about the market outlook from a Chinese astrology perspective. Note that this is not investment research or advice. More like a fun start to the Chinese New Year.
Snake is traditionally seen as an animal with “adaptability”, “creativity” and “careful planning”. Jesus reminded his disciples to be “as shrewd as snakes” among wolves (Matthew 10.16). This year of the Snake has a “wood” character, emphasising wisdom more.
Usually, I summarise what Chinese astrologers say about the market. This year, I would also like to try to bring in astrologers with AI - ChatGPT and its latest competitor, DeepSeek.
I posted two questions on each of these AI chat systems. First, what is the outlook for stock markets in the year of the Snake based on Chinese astrology? Secondly, which sectors should work well in the year of the Snake based on Chinese astrology, and which should we avoid? Given that both systems will be searching on the web for answers, I expect similar answers.
But first, here is what will make compliance teams happy: the answers from both emphasised that their output is not financial advice. ChatGPT has reminded us to “combine … insights with solid economic and market analysis for investment decisions”. And DeepSeek is more direct: “....always consult financial professionals and base investments on fundamentals, not folklore.”
So what does our digital age, AI-driven “astrologers” say about the outlook? Both of them highlight the need to maintain caution like a snake, as volatility and uncertainty will be a dominant feature of the market. DeepSeek reminds us to monitor interest rates, inflation, geo-political situations and regulatory changes. ChatGPT highlights the need for investors to adapt like a snake to “dynamic shifts in global economic and political conditions”.
In terms of sectors, both recommend AI (what a surprise …). Both say that renewable energy, health care and pharmaceuticals, mining and metals are good sectors to invest in based on the Chinese astrological sign. While DeepSeek prefers consumer staples but not luxury goods, ChatGPT says that luxury goods and wellness should be ok in the year of the Snake. Both say fossil fuels will not do too well (not because of being woke but more because fossil fuels conflict with the wood element this year). Both do not like real estate and speculative investments, with DeepSeek saying people should avoid meme stocks or start-ups.
In terms of markets, while you expect DeepSeek to say China is a good market, ChatGPT also says China is a good market because of “long-term planning, innovation and green initiatives”. Both chat systems prefer India. And so is the US. Interestingly, ChatGPT mentions Scandinavian countries because of “sustainability and green energy leadership… in alignment with the Snake themes” (reader to decide whether this is a bit of a stretch).
All sectors and countries' outlooks are not based on fundamentals but rather on what both can gather on the web on what Chinese astrologers say.
To end this blog, I will now tell you what some human Chinese astrologers say about the year of the Snake:
The year of the snake means lots of potential changes, just like snakes will shed their skin to keep growing. This means being prepared for surprises.
The wood element favours any sectors related to wood or water, like shipping, forestry, logistics and aviation (all these were not favoured by our digital AI “experts”)
Fire does not go on well with wood. So avoid sectors like fossil fuels, weapons and defence industries. Fire also means many conflicts around the world.
There is disagreement about whether the Chinese and Hong Kong stock markets will do well. Some say it will rise, but some say it will peak in Q1 (like the shape of a snake….). Some advocate investing in physical gold rather than real estate.
Looking at all these calls, human and AI, I have only one conclusion: be prepared for surprises and position your portfolio accordingly. Stay diversified. And – as DeepSeek says: always consult financial professionals and base investments on fundamentals, not folklore.
James Chu CFA
Head of Investment Solutions
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