At the start of trading on July 27, A-share indices opened with mixed performance. The Shanghai Composite Index fell 0.14%, while the ChiNext Index edged up 0.03%.
Active sectors included precious metals, batteries, and tourism & hotels, while oil, coal, and electric power sectors lagged.
Everbright Securities' Market Outlook: Markets May Consolidate in a Range, Focus on Growth Themes
Everbright Securities notes that recent policy signals have been positive, with authorities expressing support for market stability. However, the pace of domestic demand recovery remains weak, making a broad-based rally unlikely at the aggregate level. Additionally, tech stocks that have seen significant recent gains are experiencing heightened volatility due to micro-liquidity disruptions. On balance, with policy support coexisting alongside structural pressures, the market is likely to trade within a range over the short term.
In terms of allocation strategy, the near-term focus should be on stability, with a tilt toward dividend-paying assets such as banks and utilities. Over the medium to long term, high-growth sectors remain the core focus, extending beyond just technology to include export-oriented chains and resource stocks, where fundamentals are expected to continue improving. Key areas within hard tech include electronics, telecommunications, and national defense. For the export chain, focus on power equipment and machinery. Upstream resources worth watching include non-ferrous metals, coal, oil & petrochemicals, and basic chemicals.
China Merchants Securities: Limited Downside Risk, but Tech Sector Deleveraging May Lead to Repeated Fluctuations and Bottoming Divergence
China Merchants Securities highlights that recent stabilizing signals from regulators, state-owned enterprises, and listed companies—including share buybacks, repurchases, and dividends—along with significant inflows into broad-based ETFs, suggest that a policy floor is largely in place. Changes in margin trading, ETF flows, and trading structures indicate that liquidity pressures are easing, and the market is gradually forming a bottom. The second-quarter public fund allocation to TMT and individual stock concentration both hit record highs; short-term crowding may trigger volatility, but whether the trend reverses depends on industry fundamentals and earnings momentum.
Externally, attention should be paid to the Fed's interest rate decision, US bond yields, the Middle East situation, and potential policy shifts from Trump. The July Politburo meeting, likely at the end of the month, is expected to reinforce policy support, with industrial development as the main focus. Infrastructure should concentrate on the "six networks," while consumption continues to be driven by cultural tourism. Capital market rhetoric is also expected to become more supportive. Overall, while systemic downside risk is limited, the tech sector's deleveraging process may lead to repeated fluctuations and a divergent bottoming process. Allocation should follow half-year earnings reports and industry trends, focusing on TMT price increase chains, resource stocks with volume and price improvements, batteries, medical devices, innovative drugs, automation equipment, aerospace equipment, and both overseas and domestic computing power directions.
Founder Securities: The Upcoming July Politburo Meeting is a Key Catalyst to Break Market Stalemate
Founder Securities believes that the current market lacks systemic trend momentum and advises avoiding high-position science and technology stocks, where short-term correction risks are not fully released. While there may be some oversold rebound opportunities, the room for short-term gains is limited, and caution is warranted. Investors should prioritize low-position sectors with policy support, capital inflows, and technical stabilization.
Changxin Technology is set to officially list on the STAR Market, marking the year's largest IPO. In the short term, its potential capital-siphoning effect on the sci-tech board and memory chip sectors should be monitored. Over the medium to long term, Changxin fills a gap in the A-share DRAM sector by providing a new valuation anchor. The upcoming July Politburo meeting is the market's primary focus, as its guidance on second-half macroeconomic policy and industry direction will be crucial. Market expectations lean toward more positive policies, which could be the key catalyst to break the current wait-and-see sentiment.
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