which theme should be used in manifest? I need to create a light and a dark theme in xml too? or compose has a default for that?

There is no need to declare anything in the manifest. Please take a look at this sample app from Google to see how dark/light theme is set in Compose https://github.com/android/compose-samples/blob/main/JetNews/app/src/main/java/com/example/jetnews/ui/theme/Theme.kt

@Oussama Haff. thanks for the reference.. but looking into the manifest file, there is a declaration of themes and colors for light/dark themes: https://github.com/android/compose-samples/blob/main/JetNews/app/src/main/AndroidManifest.xml

AFAIK, the declaration in the manifest is needed because the Activity still need to use Theme.AppCompat for Android (or you get a runtime exception). whereas Compose Theme applies the theme on the content inside of the activity on the descendants of

setContent { }

function / This is my personal interpretation of things /

nah, you don't have to use Theme.AppCompat. You could just as easily use the on-device android:Theme.Material. The only thing you have to use a static theme for is for the, "starting window" that Android displays before your activity code starts running.

Preview annotation uses the manifest theme?

Here's an example commit which switched one of our samples from AppCompat to a platform material theme, notice how it inherits from light/dark parents: https://github.com/android/compose-samples/commit/bbe9436cfa4d0ea177af499a21d4b51d1b801c30#diff-dffd6e3920461da2ef29b76429ba730410298a65ed2cf537bdd75374a61b50bf