Since the start of the third quarter, the A-share market has overall been in a state of choppy consolidation with heightened volatility, and the characteristics of style rebalancing have become somewhat evident.
Looking ahead to the fourth quarter, how will various assets perform, and how should investors grasp structural opportunities in the market? Recently, a number of public fund institutions, including China Universal Asset Management, CCB Principal Asset Management, Fullgoal Fund, and HSBC Jintrust Fund, have successively held autumn investment strategy meetings, discussing topics such as the domestic macroeconomic trend, the outlook for A-share and Hong Kong stock markets, and positioning in popular sectors.
Fund managers generally believe that as the growth rate of traditional industries continues to improve and the AI (artificial intelligence) industry develops rapidly, the central level of overall A-share earnings growth is expected to continue moving upward, and sectors such as technology, pharmaceuticals, consumer goods, and gold may become key areas for positioning in the fourth quarter.
Economic Resilience Bolsters the Foundation
At the macroeconomic level, multiple public fund institutions judge that the fundamentals of the domestic economy are relatively resilient, and the recovery trend is fairly clear.
Yuan Jianjun, deputy general manager of China Universal Asset Management, said that China's macroeconomy has maintained resilience, liquidity is moderately accommodative, and policy continues to provide support. Large-scale household savings are expected to gradually migrate toward equity assets in a low-interest-rate environment, and structural investment opportunities stand out.
In the view of Jiang Yanze, fund manager in the Equity Investment Department of CCB Principal Asset Management, China's economy has shown strong resilience, export elasticity remains a key support, and the intensity of countercyclical policies may determine the strength of domestic demand. The accelerated construction of the "six networks" and the faster deployment of fiscal funds are expected to bring about a stabilization and rebound in infrastructure investment.
Min Liangchao, director of equity research and fund manager at HSBC Jintrust Fund, said that over the past few years, the domestic policy tone has remained stable, the share of manufacturing and technology industries in the economy has increased significantly, and future asset pricing logic will further return to company fundamentals and valuations.
Regarding the trend of the A-share and Hong Kong stock markets, public fund institutions are generally optimistic.
"In the future, overall A-share earnings are in an upward cycle, and subdivided industries are expected to continue their high prosperity," Min Liangchao said. After the high-volatility adjustment in the third quarter, market crowding has been alleviated to some extent. However, the A-share market may still be in a stage of capital rebalancing, and a fundamental style switch has not yet appeared.
Tang Hui, fund manager of Fullgoal Growth Strategy, suggested that in the current highly volatile market environment, investors need to return to fundamental judgment and adopt an investment approach of "capturing industry trends to amplify returns plus controlling drawdowns through portfolio management" to cope with subsequent market fluctuations.
Turning to the Hong Kong stock market, Xu Tingquan, deputy director of the Overseas Equity Investment Department and fund manager at HSBC Jintrust Fund, analyzed that foreign capital bases allocation on changes in fundamentals, is currently underweight in Hong Kong stocks, and tends to concentrate investments in mid- and large-cap stocks, while southbound capital has a relatively more diversified investment style. Both types of capital have room for incremental inflows going forward.
Four Major Sectors Draw Close Attention
In terms of specific sector positioning, technology, pharmaceuticals, consumer goods, and gold became keywords repeatedly mentioned at the autumn investment strategy meetings of multiple public fund institutions.
The technology sector remains the core sector of greatest concern to public fund institutions. Shen Ruoyu, fund manager at China Universal Asset Management, said that at present, the technology industry is alternately in two states: expectation-driven and performance-realization. Key focus should be placed on AI computing infrastructure, AI large models, AI applications, and semiconductor self-controllability. Investors are advised to first clarify their investment objectives and risk tolerance, and then pay attention to risk-adjusted return indicators such as the Sharpe ratio and Calmar ratio. Investment decisions should be made from a long-term perspective, focusing on whether industry trends and company competitiveness have changed.
The pharmaceutical industry currently has prominent highlights, and its allocation value is gradually emerging. Li Bokang, fund manager at HSBC Jintrust Fund, said that at present, the valuation of the pharmaceutical sector is still at a relatively low level, positive catalysts for the industry continue to land, and high-quality companies have entered a period of value realization. Looking ahead to the fourth quarter and beyond, focus on four subsectors: innovative drugs, traditional pharmaceutical companies in transition, leading companies in the CXO (pharmaceutical R&D and manufacturing outsourcing services organization) sector, and surgical robots.
The consumer sector has likewise won the favor of multiple public fund institutions. Fei Xinhan, fund manager of the HSBC Jintrust Consumer Dividend Fund, analyzed that the share price recovery in the consumer sector is based on triple support from "valuation, capital, and performance." In the fourth quarter, the consumer sector has two core investment highlights: first, external-demand tracks are performing relatively well. Leading companies that have deeply cultivated independent brands in multiple regions around the world clearly have stronger risk resistance. Second, some domestic-demand tracks are welcoming improvement and阶段性 growth, and the supply-demand relationship or inventory cycle in some subsectors is recovering. Investors can pay attention to directions with阶段性 growth opportunities such as healthy food, technology lifestyle, travel experience consumption, and self-pleasing consumption, as well as areas such as white goods and baijiu where the operating cycle has stabilized or the inventory cycle has clearly improved.
The medium- to long-term allocation value of gold assets continues to rise. Zhu Jinyu, deputy general manager of the Quantitative Investment Department at CCB Principal Asset Management, said that the monetary attribute of gold assets has long-cycle characteristics and is one of the driving forces supporting the continued rise in gold prices. From a short- to medium-term perspective, the financial attribute of gold, namely allocation demand, is the main force pushing gold prices to strengthen in stages. At present, gold assets may be mainly driven by allocation demand, and the medium- to long-term view remains positive.
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