Policy good news has arrived. Over the weekend, CSRC Chairman Wu Qing held a symposium in Beijing, engaging in in-depth exchanges with heads of certain listed companies and experts from securities and fund institutions, fully listening to opinions and suggestions on the current capital market and financial situation.
At the symposium, all participants unanimously agreed that China's macroeconomy is stable and improving, industrial structure transformation continues to deepen, the capital market is operating generally steadily, and the multi-tiered market functions are effectively playing their role. Although facing some risks and challenges, the momentum of high-quality development will not change, and there is full confidence in economic operation and the capital market.
The timing of this symposium was excellent. In the third quarter, the A-share market experienced sustained declines, and after the National Day holiday, the market fell sharply for two consecutive trading days, making market confidence urgently in need of a boost. The convening of this symposium is undoubtedly a timely rain, conducive to enhancing investor confidence.
Participating experts put forward specific suggestions for better promoting the stable and healthy development of the capital market, mainly including: continuously strengthening the construction of market stabilization mechanisms, further broadening channels for medium- and long-term capital sources and entry methods, developing and expanding patient capital, pushing qualified listed companies to increase dividend payouts and share buybacks, improving investor return and rights protection mechanisms, optimizing the issuance and listing system, supporting the growth and expansion of diverse high-quality enterprises of different types and industries, strengthening transaction supervision, enhancing cross-border risk monitoring and response research, and reserving more incremental policy tools. These expert suggestions are practical and feasible, and they also address many current market concerns, making them highly targeted policy recommendations.
CSRC Chairman Wu Qing stated that listed companies and industry institutions are important participants in the market, and he hopes everyone will actively offer suggestions and work together to build a better capital market, better reward the vast number of investors, and actively contribute to Chinese-style modernization. Relevant department heads of the China Securities Regulatory Commission attended the symposium.
This symposium released positive signals, also implying that after sustained market adjustments, various policy good news may follow one after another. This symposium is a beginning, and more policies should come afterward. So it is not just this one symposium — everyone should understand this point.
After the earlier adjustments, risks have also been effectively released, especially for tech stocks. After the previous corrections, many tech stocks have already adjusted sufficiently. At this point, market confidence may gradually recover after policy good news emerges. A policy combination punch may be introduced later to push the market toward stabilization and rebound.
In the fourth quarter, the market is expected to see a decent rebound rally. Everyone can seize the opportunities in the fourth quarter and fight a beautiful turnaround battle.
This bull market is not over — this must be emphasized. Although the market decline has left many people lacking confidence, and some influential figures have come out claiming a bear market has arrived, I believe the market is still in a structural行情 with accelerated sector rotation, but overall market opportunities still exist.
Some worry that continuously rising US Treasury yields may impact the stock market, but we also see that the three major US stock indices remain at historical highs, with the Nasdaq recently hitting a new all-time high. This also shows that the turning point of this US-led tech bull market is not the turning point of US Treasury yields, but the turning point of the industrial development cycle. As long as the AI technology industry development has not reached a turning point, the US tech bull market is not over, and our A-share tech bull market will not end either.
What needs attention in the future is whether AI technology capital expenditure will decline. Another is whether the performance of AI tech leader stocks represented by Nvidia will decline. As long as these turning points do not appear, everyone need not worry too much.
Of course, A-share tech stocks are influenced by US stocks, mainly because the chain leaders are in the US market, such as the Nvidia industrial chain, Google industrial chain, Tesla industrial chain, Apple industrial chain, and so on. If the chain leaders peak and decline, A-share tech stocks will most likely also show turning point phenomena. But currently, the A-share tech bull market remains fierce, with no signs of a turning point.
The US stock market is also an extremely differentiated market, with capital basically concentrated in tech leaders, while other industry sectors have few major opportunities. This extreme differentiation is also related to the current economic transformation.
Why do our tech stocks experience very large pullbacks, while US tech leaders have risen for so many years with only slight corrections? I think it mainly depends on industry position and whether there is performance support. Nvidia's market value hit a historical high, reaching $5.7 trillion, but because it has already released performance, its price-to-earnings ratio is actually less than 20 times. Meanwhile, many of our A-share tech stocks have not yet released performance, with P/E ratios reaching hundreds of times. This also determines that A-share tech stocks are speculation on future performance release expectations, while US tech leaders have already released performance. This determines that A-share tech stock volatility will definitely be very large. When rising, everyone tells stories; when falling, they look at performance support, and upon finding little performance support, the decline becomes quite severe. This dooms A-share tech stock volatility to be far greater than US tech stocks — everyone needs to have a clear understanding of this.
So even if the market rebounds in the fourth quarter, there will be obvious differentiation within tech stocks. Some tech leader stocks with genuine industry position and performance support may attract capital attention and show relatively obvious rebounds; while some tech stocks that have long been speculating on concepts may have no more opportunities. So the key is whether a tech stock is a genuine tech leader, not a fake tech stock. For example, one should look at whether third-quarter earnings can be delivered and whether subsequent orders will increase, to determine whether it is worth关注。
From the perspective of industry allocation, when everyone was chasing solar in May and June this year, I suggested everyone must adopt a three-step strategy to respond: first, resolutely deleverage; second, add half a position; third, one hand in tech and one hand in dividend. Following this three-step strategy, one could basically avoid the third-quarter major decline risk. Especially the one-hand-tech-one-hand-dividend strategy played a big role — when tech stocks fell sharply, dividend stocks rose against the trend, hedging the downside risk of tech stocks.
Although the market will rebound in the fourth quarter, this strategy remains effective. Through one hand in tech and one hand in dividend, portfolio stability can be improved, helping net asset values steadily recover. Because the dividend sector plays the role of a shield, achieving stable dividends through allocating value stocks with stable dividend rates; tech stocks play the role of a spear, responsible for offense, belonging to growth stocks. One hand in tech and one hand in dividend remains an effective investment strategy.
MACD golden cross signals have formed, and these stocks are rising well! Sina statement: This news is reprinted from Sina's partner media. Sina publishes this article for the purpose of conveying more information and does not mean it agrees with or confirms its views or descriptions. The article content is for reference only and does not constitute investment advice. Investors operating based on this bear their own risks.
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