news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

on october 7, as the opening day of the a-share market approached, many brokerages expressed optimism about the future trend of the market.

citic securities believes that the market will usher in a major turning point; industrial securities said that it is firm in bull market thinking and there are no time and space limits for the time being; huajin securities proposed that the rapid rise of a-shares has not yet reached a peak.

citic securities: a big reversal in expectations, a big turning point in the market

citic securities research report pointed out that there have been major changes in policy signals and market expectations have experienced a major reversal. in the future, domestic demand policies will continue to increase or push price signals to arrive earlier, and the market will usher in a major turning point; after the expected major reversal, the increase in retail investors will mainly characterized by the concentrated entry of funds, the pulse-like rise will continue in the short term; it is currently in the transition stage from an expected major reversal to a major inflection point in the market, with low p/b and domestic demand restoration as the core. once the price signal is confirmed, a market boom will begin. after the turning point, an annual bull market with the credit cycle rising again as its core feature will begin, and institutional investors will have better entry opportunities.

first of all, from the perspective of policy and price signals, the innovation of monetary tools and the politburo meeting’s stance on real estate at the end of september greatly exceeded market expectations. the scale of incremental fiscal policy during the year may be relatively mild, but the direction of use may be significantly expanded. under the influence of quantitative policies, the turning point of price signals is expected to arrive early.

secondly, from the perspective of market characteristics, institutional investors have significantly increased their positions in a-shares recently, but retail investors have entered the market more rapidly. this round of market has superimposed two characteristics: a sharp reversal of expectations and the concentrated entry of incremental funds from retail investors. the pulse-like rise is still mainly driven by expectations and funds, supplemented by verification of fundamentals.

finally, from the perspective of allocation ideas, there are two main lines in the market transition stage. one is low p/b style revaluation, and the other is the valuation restoration of the domestic demand sector. it is recommended to downplay dividends and go overseas; when the price signal is confirmed, the market will usher in a major turning point. after that, the market led by institutions is expected to gradually return, and by then the two major sectors of high-quality growth and domestic demand are expected to continue to dominate.

significant changes in policy signals

market expectations for a big reversal

1) the monetary instrument innovation and the politburo meeting’s stance on real estate at the end of september both significantly exceeded market expectations. on the monetary policy front, this round of widespread interest rate cuts is very rare in history. at the same time, the collateral swap facilities and stock repurchases and special re-lending for holdings launched by the central bank clearly exceeded market expectations and were widely understood by investors as providing the central bank with a put option protection for the stock market has made investors more firm in their expectations of a market bottom. in addition, it is extremely rare for the politburo meeting to analyze and study the economic situation in september, reflecting the importance that decision-makers attach to increasing macro-control and strengthening counter-cyclical adjustments. among them, the meeting proposed for the first time to promote the real estate market to "stop falling and stabilize". this is the first time that policy objectives have been clarified since the politburo meeting in july last year adjusted the positioning of real estate. it also made it clear for the first time that reducing supply should also be used as one of the control measures.

2) the scale of the incremental fiscal policy during the year may be relatively moderate, but the direction of use has been significantly expanded. in terms of fiscal policy, which the market is most concerned about, the scale of incremental fiscal policy may be relatively mild in the short term, but the adjustment of its direction may be more critical. the macro team of the citic securities research department believes that the focus of subsequent fiscal policies may be tilted towards benefiting people's livelihood and promoting consumption. the change in the focus of fiscal expenditures will help improve the efficiency of fiscal stabilization of growth. in the direction of incremental fiscal policies, subsequent efforts may shift from infrastructure and industrial subsidies in the past to subsidizing low-income groups, subsidizing childbirth, and stimulating consumption. in terms of the scale of the policy, the amount of new special government bonds and special refinancing bonds may be around 2 trillion yuan or more. based on the fiscal revenue and expenditure data this year, the fiscal revenue side is under greater pressure, but the expenditure side is more rigid. in the future, it is not ruled out that incremental fiscal tools will be introduced to supplement the revenue and expenditure gap to ensure the intensity of fiscal expenditures.

3) under the influence of incremental policies, the turning point of price signals is expected to arrive early. according to data tracked by the real estate team of citic securities research department, looking at the lowest listing prices of actively traded communities in the three core cities of beijing, shanghai and shenzhen, the number of projects with lower minimum bids in shenzhen on october 5 was significantly less than the number of projects with higher lowest bids; looking at the cities that track the number of listings, the number of listings in 77.5% of the cities dropped on october 6 compared with september 30, with the overall median decline being 0.34%; looking at second-hand housing transactions by large intermediaries in 75 cities, the number of listings in the past 8 days has the trading volume (september 28th to october 5th) increased by approximately 82% compared with the same period in 2023, and was only approximately 5% lower than the trading high after the "517" policy. considering that it is currently during the national day holiday, the data after the holiday may be exceeding the level after the “517” new deal. under the premise of clear policy goals, adjustments to policy ideas and the continued implementation of a series of policy combinations in the future, the real estate team of citic securities research department predicts that starting from first-tier cities, it is expected to stop the decline in housing prices within the year. if the policy fails to fully achieve the goal of stopping the decline , there is still room for further policies to be introduced in various places.

incremental funds, mainly retail investors, are concentrated in the market

characteristics, the pulse-like rise is expected to continue in the short term

1) institutional investors have significantly increased their positions in a-shares recently, but retail investors have entered the market more rapidly. from the perspective of new public offerings, active products increased by only 2.5 billion in september, and passive products reached 25.1 billion. however, we estimate that csi a500 etf-related products have not started to build positions intensively. according to calculations by the quantitative and allocation group of citic securities research department, the current overall positions of public common stock, partial stock hybrid and flexible allocation products are 78.9%, 73.8% and 68.5% respectively, which are 9.1% higher than the highs since 2016. , 11.9 and 3.6 percentage points, there is not much room to add positions. according to a survey of citic securities channels, active private equity positions were 68.9% on september 20 and 71.0% on september 27, an increase of 2.1 percentage points in a single week, which is not a very large increase in positions in a single week in history. judging from the flow of foreign capital, according to refinitiv data, from may 23 to september 25, sample funds tracking msci china had net outflows for 18 consecutive weeks. the average weekly net outflow amount was us$580 million, while on september 26 from october 2 to october 2, active funds had a net inflow of us$610 million, and passive funds had a net inflow of us$4.56 billion, totaling us$5.16 billion, which was the largest single-week net inflow since 2015. the return of foreign passive products is more obvious, while active products are still hesitant. the return of foreign passive products may not be based on fundamental logical analysis, but more to make up for the previous systematic underweighting of chinese equity assets. overall, we believe that it is completely impossible for institutions to add positions or reflow to dominate the current pulse-like market. more incremental funds still come from the entry of retail investors and the idle funds of some companies. judging from our research on citic securities channels, there are still a large number of new account openings during the national day, and the pulse-like market in the short term may still be dominated by incremental capital entry such as retail investors.

2) this round of market conditions has the two characteristics of a sharp reversal of expectations and the concentrated entry of incremental funds from retail investors. from an analogy point of view, the current market status is similar to the market driven by the expected dramatic reversal in november 2022 and the market driven by the concentrated entry of huge amounts of retail investors' funds in november 2014. but in addition to these two characteristics, there are two differences in this round of market conditions: first, in the past two years, residents’ risk appetite has been continuously decreasing, and excess savings have been accumulating. against the background of asset shortage, the recent sudden reversal of the stock market will attract a large number of excess savings. savings funds are concentrated in the market; secondly, the current information transmission speed of the chinese mobile internet and the degree of self-reinforcement of the same information are far beyond the past. new media carriers such as short videos will geometrically promote and amplify the same information, making it easier for investment investors expect a high degree of consistency in a short period of time. under this new feature, this round of pulse-like rises may last shorter but be greater than the first wave of rises in the two bull markets of 2006-2007 and 2014-2015. taking the shanghai stock exchange index as an example, the first wave of the bull market in 2006-2007 lasted for about 8 weeks, with a cumulative increase of 28.6%. the first wave of rise in the 2014-2015 bull market lasted for about 12 weeks, with a cumulative increase of 46.7%. now, this round of pulse-like rise has lasted for one week, with the cumulative increase reaching 22.2% (taking the central bank press conference on september 24 as the starting day of the increase). based on these characteristics, if we also take into account that there is still a large amount of incremental funds waiting to enter the market, it is expected that the pulse-like rise will continue in the short term.

we are currently at a major turning point in the expected reversal of the market.

the transitional stage focuses on low p/b and domestic demand recovery.

1) the first main line is low p/b style revaluation. after the politburo meeting in september put forward the requirement to "stop falling and stabilize" the real estate sector, it has actually given a clear signal to curb or even reverse the downward trend in the value of collateral and the cycle of debt deflation. we believe that at least in the short term, the elasticity of such low p/b companies to repair is much greater than the elasticity of expected repairs in revenue, earnings, etc. industries where low p/b companies are concentrated, such as real estate, banking, non-bank finance, and construction and building materials, are one of the clearest main lines. in addition, active management institutions are currently overweighting companies with high p/b and underweighting companies with low p/b. among all a-shares, the 20% stocks with the lowest p/b accounted for 28.3% of the circulating market value, but only accounted for 25.0% of the positions held by major institutional investors, with an underweight ratio of 3.3 percentage points; the 20% with the highest p/b for individual stocks, the circulating market value accounts for 27.7%, but the positions held by major institutional investors accounted for 36.1%, overweighting by 8.4 percentage points. as the gap between the relative returns of active products and the index continues to widen, and at the same time, the net value rebounds significantly in a short period of time, we expect to see a significant increase in the redemption volume of active products, and they will instead invest in various broad-based etf products. this kind of position adjustment will also benefit the low p/b style more.

2) the second main line is the restoration of the valuation of the domestic demand sector. this round of policies attaches unprecedented importance to boosting domestic demand and will greatly change the way investors evaluate the valuation of domestic demand products. looking forward to the market outlook, the post-consumption cycle features are significant, and the expected economic recovery after the policy attitude is clear will actively drive the expected rebound in the consumption boom. after experiencing the early release of pessimism, the current valuation of the consumer sector is still at a historically low level. since 2024q4, most sub-sectors are at a stabilizing turning point due to the reduction of base pressure. it is recommended to actively treat consumption recovery opportunities under the policy shift. it is recommended to focus on the consumer internet with both offensive and defensive capabilities, essential sectors such as dairy products and mass catering with low valuations and high returns and expected to be the first to stabilize operations, as well as procyclical directions such as alcohol, human resources, and hotels driven by economic recovery expectations. the sustainability and upside potential of the market depend on the specific effectiveness of subsequent policies after they are implemented, but it is currently at an inflection point for recovery driven by a clear policy shift.

it is expected that institutions will usher in better entry after the price signal turning point is confirmed.

timing, allocation, excellent growth and domestic demand will continue to dominate

the current market is in the transition stage from the expected big turning point to the big turning point of the market. the early stage of the market is characterized by the concentrated entry of retail investors, and the pulse-type market is driven by expectations and funds. for investors who currently have high positions, it is recommended to adjust the position structure, reduce the positions in high-valued sectors, move closer to the weight index as a whole, and avoid excessive deviations from the index, especially if the current institutions are obviously underweight. low p/b industries and domestic demand sectors. for funds that still need to add positions and are "short" in the early stage, it is recommended to give priority to low p/b industries and domestic demand sectors, or use broad-based index etf tools such as 300etf and a500etf as the first choice for adding positions. after the end of the pulse-like rising market, with the continuous implementation of incremental policies, the price signal represented by housing prices is likely to confirm an inflection point within the year. at that time, it is expected to start an annual bull market with the credit cycle as its core feature. institutions investors are expected to have a better time to enter the market. it is recommended that the allocation should be officially switched to domestic demand and high-quality growth. in the early stage, priority should be given to increasing domestic demand while downplaying dividends and overseas expansion.

risk factors

sino-us frictions in the fields of technology, trade, and finance have intensified; domestic policies and economic recovery have fallen short of expectations; macro liquidity at home and abroad has tightened more than expected; conflicts in russia, ukraine, and the middle east have further escalated; and my country's real estate inventory has not been digested as expected.

industrial securities: firm bull market thinking time and space will not be limited for the time being

the industrial securities research report pointed out that under the new policy orientation of “seizing key points and taking proactive actions”, the market logic has been reversed. first of all, judging from historical experience, when a bull market starts, it will mostly go through a stage of rapid bottom repair. after that, it gradually enters a window with a relatively gentle upward slope, longer duration, and stronger money-making effect. since this round of market rapid rise from the bottom in mid-september, the shanghai composite index has risen by 27.2%. the increase is close to the bear-bull reversal in 2019 and lower than the early stages of previous bull markets. from a medium-term perspective, everyone must abandon the bear market mentality, strengthen the bullish mentality, and do not set limits on the time and space of the market, because the financial power is still flowing.

the following are its latest views:

when it comes to the a-share bull market, before the big bull market of 2013-2015, "5·19" was an indelible memory in the hearts of many old investors. the reason why it is remembered by the market is not only because it became a rare bright spot in the turbulent environment at the turn of the century, but also because it was also the first truly phenomenal bull market in the history of a-shares with extensive social participation. in this report we will take you back to those exciting years. see the report for details:

1. firmly maintain bull market thinking, and there are no limits on time and space for the time being.

1.1. under the new policy orientation, the market logic has been reversed

under the new policy orientation of “grasping key points and taking initiative”, the market logic has been reversed. the previous weakening of fundamentals + pessimistic expectations of policy "inaction" have led to a continued correction in the market. since september 24, the continuous "policy combination" has been intensively implemented, and the market risk appetite has been restored rapidly. after the short-squeeze rebound at the end of september, the growth of chinese assets, especially hong kong stocks, in 2024 has led the world. during the national day holiday, hong kong stocks continued to surge, leading the world.

one of the core reasons for the reversal of market logic is that capital market policy dividends exceed expectations:

on september 24, the central bank announced the creation of new structural monetary policy tools, which highlighted the stock market as the focus of this round of policy combinations. more importantly, it creatively opened up the channel for the central bank to assist the capital market, which will effectively support the chinese stock market in the future. revaluation. 1) create swap facilities for securities, funds, and insurance companies. the first phase is 500 billion yuan. there can be many phases in the future. non-bank institutions can continuously obtain liquidity from the central bank through asset pledges, which in turn helps to improve china’s currency. circulation velocity. 2) create a special re-loan for stock repurchases and shareholding increase. the first phase is 300 billion yuan, which can be used for many tranches in the future. the central bank has announced policies through actions to encourage listed companies to increase shareholder returns and support repurchases and increase stock holdings, which is conducive to guidance. mid- to long-term incremental funds such as industrial capital entered the market.

the politburo meeting on september 26 once again emphasized that efforts should be made to boost the capital market, vigorously guide medium and long-term funds to enter the market, and open up the blocking points for social security, insurance, financial management and other funds to enter the market. we must support mergers, acquisitions and reorganizations of listed companies.

the second core of the reversal of market logic is that the new macro policy ideas will focus on the demand side:

the politburo meeting on september 26 mainly focused on demand, combining consumption promotion with benefiting people's livelihood, increasing the income of low- and middle-income groups, and improving the consumption structure. it is necessary to cultivate new consumption formats.

the politburo meeting should promote the real estate market to stop falling and stabilize, adjust the housing purchase restriction policy, and reduce existing mortgage interest rates to help unleash consumer demand. according to calculations by the people's bank of china, a 50bp reduction in existing mortgage interest rates will benefit 50 million households and reduce household interest expenses by an average of approximately 150 billion yuan per year. stabilizing the property market and boosting the stock market will effectively interrupt the vicious cycle of balance sheet contraction.

the third core of the reversal of market logic lies in the stronger-than-expected counter-cyclical adjustment of macro policies:

the space for my country's monetary policy easing has been opened up, and further easing of liquidity in the fourth quarter is still worth looking forward to. first of all, the politburo meeting on september 26 clearly required that the deposit reserve ratio be lowered and interest rates be implemented in a powerful manner. the central bank's regular third quarter monetary policy meeting on september 29 also called for increased monetary policy control. secondly, the fed's interest rate cut cycle has started, and the rmb remains strong.

positive fiscal policy in the fourth quarter still has potential to be tapped. the politburo meeting emphasized that government investment should better play its leading role. the implementation effect of monetary easing still requires the coordination of fiscal easing, and subsequent policy coordination may be further strengthened. the next important observation point is the national people’s congress standing committee meeting in late october.

1.2. firm bull market thinking: there is still room for growth in the short term, and in the medium term, it will enter a new stage of shock but sustainable growth.

after the pre-holiday short-squeeze rise, a question that investors are generally concerned about is how much room there will be in the subsequent market.

first,judging from historical experience, when a bull market starts, it will mostly go through a stage of rapid bottom repair. after that, it gradually enters a window with a relatively gentle upward slope, longer duration, and stronger money-making effect. since this round of market rapid rise from the bottom in mid-september, the shanghai composite index has risen by 27.2%. the increase is close to the bear-bull reversal in 2019 and lower than the early stages of previous bull markets.

secondly,from a valuation perspective, the current major broad-based indexes are still only restored to around the historical midpoint. from the perspective of pe valuation, the chinext index, csi 500, csi 1000, and shenzhen component index are still lower than the historical median. looking at pb valuations, all indices are below their historical medians.

and,within the larger framework of reversal logic, what we need to focus on is how long this market will last, rather than how high it will be in the short term.

from a medium-term perspective, everyone must abandon the bear market mentality, strengthen the bullish mentality, and do not set limits on the time and space of the market, because the financial power is still flowing. looking back at history, abundant incremental funds are an important driving force for the market to eventually develop into a bull market. and from the current point of view:

1) as china’s stock market recovers and its economy stabilizes, capital’s nature of pursuing profits will lead to a new round of upsurge in european and american funds and funds from “one belt, one road” countries to allocate to china’s stock market.we have seen that foreign capital has recently shifted from short-cover to active long positions, which has become the main force driving the surge in hong kong stocks. for a-shares, foreign capital inflows have slowed down significantly in recent years and even experienced outflows, which is far less than the average annual scale of more than 3,000 from 2018 to 2021. foreign capital's allocation to a-shares has also fallen to a historical low. recently, we have seen the resonance of foreign long-buying and short-cover funds. in the medium to long term, the replenishment of foreign investment positions will drive funds to continue to flow back into china.

2) the current allocation proportion of equity assets by domestic institutions is still at a historically low level, and subsequent scale growth and rising positions are expected to drive incremental market entry.for example, in terms of insurance funds, according to luo yanjun, director of the personal insurance department of the state administration of financial supervision, at the state council’s regular policy briefing, as of the end of august 2024, the balance of insurance funds used was 31.8 trillion yuan, of which 3.3% was invested in stocks and stock funds. trillion yuan, accounting for only 10.4%. for example, in terms of private equity, according to calculations by china resources trust, as of the end of august 2024, the stock private equity position was 48.45%, which is also at a historical low. in terms of public offerings, although the position size is not low due to regulatory requirements, the scale growth has slowed down significantly in recent years. as the market recovers in the future, fund issuance is also expected to pick up.

3) a new round of reallocation of domestic residents’ wealth to the stock market has just begun.with the recent surge in the market, investors are enthusiastic about opening accounts. looking forward, with the trend of reallocation of residents' wealth, industrial capital and financial management funds to the chinese stock market, chinese assets are expected to receive a steady stream of incremental funds.

3. in terms of structure, in the short term, focus on the rebound from the decline, and in the medium and long term, focus on the three main lines of "tech bulls", "domestic demand bulls", and "sea export bulls"

in the short term, the market is undergoing a beta-style recovery, so pay attention to the direction of the rebound from a deep decline.looking back at historical experience, every bull market has started with exponential excitement. moreover, at this stage, the market often shows a relatively obvious "oversold rebound" feature. the same goes for this round.

in the medium and long term, we must seize one change:changes in policy orientation should focus on two directions: mergers, acquisitions and restructuring, and "emphasis on shareholder returns." focus on three main lines: "technological bull", "domestic demand bull", and "sea cow".

first, selects "tech cows", including new productivity represented by semiconductors, communications, new energy vehicles, national defense and military industry, computer ai, medicine and biology, and advanced manufacturing. the field of new productivity is the juncture of long-term promotion of economic momentum switching and short-term support policies. under the emphasis of the politburo meeting and the strong promotion of regulators, future mergers, acquisitions and reorganizations will have a significant catalytic effect on "tech bulls".

secondly, select "domestic demand bulls", be optimistic about the pan-consumer industry leaders in the emerging service industry, traditional consumption and other fields, and pay attention to dividends, holdings increase, buyback and cancellation behaviors.

this round of policy stimulus pays more attention to the demand side, and domestic consumption has benefited.

from the perspective of various industry valuations, the valuation of the pan-consumer sector is still at a historically low level.

the interim report shows that the company has solid fundamentals and is actively rewarding shareholders through dividends and buybacks.

third, continue to be optimistic about the "sea cow".nuggets are the winners in overseas industry chains such as new energy vehicles, power equipment, home appliances, consumer electronics, and furniture. as the federal reserve enters an interest rate cut cycle, overseas economies are expected to stabilize and pick up, and maintaining high external demand will bring opportunities for companies related to the "overseas chain".

risk warning

economic data fluctuated, policy easing was lower than expected, and the fed's interest rate cut was lower than expected.

huajin securities: the rapid rise in a-share prices has not yet reached a peak.

investment points

the sharp tightening of policies and the extreme turnover rate are signs that the short-term rapid rise of a-shares has peaked.

(1) there are 12 periods of short-term rapid rise in a-share prices in history, lasting from 10 days to 4 months.

(2) the core factors that promote the short-term rapid rise of a-shares are major positive policies and the continuous influx of funds; in addition, during each rapid rise, the trading volume rebounds from lows by 2-10 times.

(3) a substantial tightening of policies and an extreme turnover rate are signs that the short-term rapid rise has reached its peak: first, policies have been significantly tightened, such as the acceleration of stock issuance in 1995, the "12 gold medals" in 1996, and the stamp duty increase to 5‰, the reduction of state-owned shares in 1999, the stamp duty increase to 3‰ in 2007 and the reduction of large and small non-owned shares, the restart of ipo in july 2009, and the cleanup of over-the-counter capital allocation by the china securities regulatory commission in june 2015; second, the turnover rate peaked most reach extremely high levels of around 5%-20%.

the rapid rise in a-shares has not yet reached a peak and is likely to continue in the short term.

(1) there are currently no signs of policy tightening or redirection. first, in terms of economic policy, there is a high probability that it will be difficult to change in the short to medium term, and fiscal policy and other policies may instead make further efforts. second, in terms of capital market policies, there is a high probability that the short-term policy will still be based on boosting and positivity: first, the policies introduced on september 24 will most likely need to be implemented in the short term; secondly, during the rapid upward trend at the end of september, financing and retail capital inflows are still low, and the market foreign capital allocation has not yet seen a resurgence, and regulatory restrictions and crackdowns on stock market capital entry may be difficult to achieve in the short term.

(2) the current capital inflow has not yet reached its extreme. first, the scale of inflows of financing and foreign capital is still relatively small. second, the increase in turnover rate or transaction volume has not yet reached the extreme: first, when the rapid rise peaks, the turnover rate is mostly at an extremely high level of 5%-20%, and the increase in transaction volume is mostly 2-10 times; secondly, in the future, judging from the fact that the turnover rate of all a-shares is only about 4%, the daily turnover may reach 5-10 trillion or even higher before there is a risk of peaking.

the post-holiday rise is likely to continue, and there may be fluctuations, but it is difficult to reach a peak.

(1) molecular side: economic and profit recovery expectations may rise after the holiday. first, expectations for economic recovery have increased: first, travel consumption during the national day holiday exceeded expectations; second, after the real estate policy was relaxed, the weekly real estate sales growth rate in first-tier cities rebounded significantly year-on-year. second, the third quarterly report forecast after the holiday has begun to be released, and the rebound trend of a-share profits may continue.

(2) liquidity: there may be further inflows of funds into the stock market after the holiday. first, the u.s. manufacturing pmi and non-farm employment data in september were better, and expectations for an interest rate cut in november have declined; however, domestic liquidity is likely to remain seasonal after the holiday. second, chinese assets surged during the holidays. post-holiday financing and foreign capital inflows may accelerate, and new funds may also rebound significantly.

(3) risk appetite: it may continue to rise after the holiday. first, the conflict between iraq and israel escalated during the national day holiday, but it had little impact on a-shares after the holiday. second, hong kong stocks and chinese concept stocks surged during the holidays, and there are still many people waiting to open accounts. a-share risk appetite may continue to rise after the holidays.

the logic of short-term supplementary growth continues to prevail, and we will continue to focus on technology growth, core assets and financial real estate after the holiday.

(1) in the short term, technology, financial real estate and core assets may continue to dominate. first, a review of history shows that during short-term rapid rises, industries with policy guidance and upward industrial trends lead the gains; second, current policy guidance and upward industrial trends point to technological growth, while finance, real estate, and consumption are also supported by policies.

(2) with the continuous inflow of incremental funds, securities companies, real estate companies, etc. may still have room for growth. if the a-share turnover rises to rmb 30,000-5 trillion in the future, based on historical matching, non-bank finance and real estate will still have an increase of about 25%-120% compared to the closing price on september 30.

(3) petrochemicals, home appliances and other industries may also make up for the short-term gains.

(4) it is recommended to continue to pay attention after the holiday: first, the policies and industry trends are upward, and computers (hongmeng), media (film and television, games), electronics (chips), and communications may make up for the growth; second, benefiting from policies to improve economic recovery expectations, core assets (consumer, electronics, pharmaceuticals) that make up for the increase and foreign capital inflows; third, securities firms (including internet finance, etc.) and real estate that benefit from rising policies and sentiment.

risk warning: historical experience may not be applicable in the future, policies may change unexpectedly, and economic recovery may not be as good as expected.