Huatai Securities Co., Ltd. noted in its research report that external disturbances intensified last week, with Japan's rate hike expectations tightening global liquidity, weighing on Hong Kong stocks, particularly the Hang Seng Tech Index. Meanwhile, A-shares experienced a volatile divergence, with no clear sustained market theme.
In the short term, the recent rebound in ChiNext and STAR Market stocks appears to be nearing its end, and the market has entered a phase of bottoming, consolidation, and rebalancing. Over the medium term, July's economic data showed strong external demand but weaker domestic demand, with effective demand still needing to be catalyzed. However, the scope of improving mid-cycle conditions is expanding, and the direction of upward earnings revisions is consistent with signals of improving industry conditions. The foundation for an upward trend remains unchanged, and attention should be paid to signals from the third-quarter policy window and the breadth of earnings recovery.
In terms of allocation, the AI chain remains the preferred choice, with communication equipment leading, followed by the domestic computing power chain and AI-related power utilities. Other directions to watch include CXO leaders with undemanding earnings expectations, non-ferrous metals, and leaders in the export chain. Dividend-focused positions should be held, with a preference for low-volatility banking and transportation sectors.
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