It's leaking around the cylinder head gasket. It most likely needs to have the head torqued down again, a normal procedure. Sometimes even when torqued down right they still leak due to an uneven gasket surface. Check the mating surface for dips or grooves. They can be sanded out by using 220-400 grit sandpaper fastened down to a piece of glass for flatness. Oil the head and make figure "8" passes. At regular intervals, like every 5 "8"'s turn the head a quarter turn to keep things even. Do this enough on the head it will raise the compression but that's not what we're after here
all we want is a flat surface.
For a more dependable seal use something like Permatex Copper Spray-A-Gasket on the gasket. It helps to seal it better. Get rid of the acorn nuts. They can bottom out and cause false torque readings or even cause you to pull the threads right out of the block. Get some good nuts from a bolt store or Lowes or Home Depot, where ever. Just don't use the stock.
I have a new 49cc HT motor coming. Even before it gets here my new head stud set from Sick Bike Parts arrived. I also tap all the holes out. The Chinese have a bad habit of not tapping the holes to the bottom. That causes stripped threads due to there not being enough thread engagement.
The torque differs according to the size of the bolt. A 66cc has a M8 size bolt and the head studs need to be torqued to 15 lbs as a good number and for the 49cc M6 bolts 8 pounds is enough. Use a "Z" or "X" pattern to torque the bolts, don't just go around in a circle. That causes uneven torque application and can cause a warp in the head.