According to ZhiTong Finance APP, GF Securities Co.,Ltd. (000776) released a research report stating that A-share 2026 net profit attributable to parent is forecast to grow by over 15%, yet valuation contribution is -24%, a level of valuation compression rarely seen in history, exceeding the historical average negative valuation contribution of about -14%, and also exceeding the valuation compression seen in years with double-digit earnings growth (2013, 2017, 2021). As of October 16, short-term sentiment indicators for major indices dropped to the 0% historical freezing point, and the ChiNext Index deviated downward from its 20-day moving average by more than 10% for the fifth time, each historically corresponding to an oversold rebound. Regarding share lock-up releases, the December peak in A-share lock-up expirations has historically had limited impact, while Hong Kong stocks in the fourth quarter may face sentiment pressure from the lock-up wave involving large models, GPUs, and related sectors in late 2026 to early 2027. The main views of GF Securities are as follows: 1. A-share 2026 net profit attributable to parent is forecast to grow by over 15%, but valuation contribution is -24%, which is historically rare across multiple dimensions. ① In historical years of valuation compression, the average negative valuation contribution was around -14%, and this year significantly exceeds that; ② With reference to years of double-digit earnings contribution (2013, 2017, 2021), this year's valuation compression is already at the largest historical level; ③ Even considering the consecutive valuation increases in 2024-2025, there have been multiple historical cases where valuation led first and earnings followed. After two consecutive years of A-share valuation expansion, if earnings delivery was achieved, the valuation compression that year was within 10% (for example, 2014-2015 saw valuation expansion first, 2016-2017 saw earnings release plus slight valuation decline; 2019-2020 saw valuation expansion first, 2021 saw earnings release plus slight valuation decline). In other words, given this year's earnings forecasts, the market's pricing of non-earnings factors (discount rate, risk appetite) has already been largely reflected, with short-term pessimistic sentiment fully expressed.
2. The valuation increase of the AI industry chain in 2024-2025 has also been fully offset in 2026. As the chart below shows, from 2023 to 2025, key A-share AI companies were mainly driven by positive valuation contribution; from 2024 to 2025, earnings contribution was also gradually released. In the 2026 interim report, key AI companies' net profit growth was about 76%, and the full-year expected growth rate further rose to 85%; however, based on stock price performance, the negative valuation contribution in 2026 is over 40%. This indicates that the valuation decline of the AI industry chain this year has already outweighed the valuation increase in 2024-2025, meaning that the stock price gains over the three consecutive years from 2024 to 2026 were basically entirely driven by earnings, with no valuation expansion from the market. This position also represents that the market's industrial expectations for 2027-2028 have dropped to a very low level.
3. As of last Friday (October 16), short-term sentiment indicators for major indices fell to the 0% percentile. As of last Friday (October 16), the short-term sentiment indicators for Wind All A, ChiNext Index, and STAR Market Index all dropped to near the 0% historical freezing point. Historically, falling to the 0% low percentile corresponds to a high win rate for short-term index rebounds.
4. Since the 2016 circuit breaker, this week marks the fifth time the ChiNext Index has deviated significantly downward from its 20-day moving average by more than -10%. Historically, the four previous instances of breaking below the moving average by -10% all corresponded to short-term oversold rebounds: March 2021 rebounded for 94 days, up 27.6%; April 2022 rebounded for 48 days, up 32%; April 2025 continued to rise after the signal was triggered, gaining until October; July 2026 rebounded for 15 days, up 9.8%.
5. The above indicators show that market pessimism has been expressed to an extreme in the short term, and an oversold rebound is expected to begin next; how long the rebound lasts and how much it can rise depends on signal verification in November-December regarding the impact of the U.S. midterm election situation on major asset classes, as well as global catalytic events in the AI industry chain and the U.S. stock earnings window.
Second, how do lock-up release pressures in A-shares and Hong Kong stocks affect the market? 1. For A-shares, there is a peak in lock-up expirations in December 2026, but historically the impact on the stock market has been limited. Based on statistics since 2010 for A-shares, the transmission chain of lock-up release → reduction → All A impact is not obvious. ① High lock-up releases often correspond to high reductions, with a high correlation between monthly lock-up release scale and monthly/next-month All A net reductions; ② However, high lock-up releases do not necessarily correspond to All A declines. There is no correlation between high monthly lock-up releases and same-month market performance, and a weak negative correlation with next-month market performance. ③ If further screening for months with lock-up releases >500 billion yuan: same-month All A performance is unaffected, and actually has a 56% probability of rising; while the next month is somewhat affected, with a 38% win rate.
2. For Hong Kong stocks, the fourth quarter may face sentiment pressure from large-scale lock-up releases ahead. (1) There is a correlation between large-scale lock-up waves and Hong Kong stock declines. Declines are usually largest before lock-up releases; after lock-up releases, a rebound is not guaranteed, but a phased bottom may form; dividend stocks are less affected by lock-up releases. (2) The next lock-up wave is from late 2026 to early 2027, concentrated in companies involving large models, GPUs, optical modules, intelligent driving, etc., which may exert sentiment pressure on Hong Kong stocks in the fourth quarter.
Risk warnings: Geopolitical conflicts exceeding expectations, causing global inflation upward pressure to exceed expectations; overseas inflation and U.S. economic resilience causing global liquidity to enter a tightening cycle faster; domestic stabilization efforts falling short of expectations, leading to weak economic recovery and declining risk appetite, etc.
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