From October 20-22 along the banks of Shanghai's Huangpu River, the 2026 Sustainable Global Leaders Conference returns once again. Nobel and Turing Award winners will take the stage to discuss the future and trends of technology, and the网红 professor who "rescues" people from anxiety and the era of involution — Macfarlane and Xiang Biao — will engage in a live dialogue!
Limited seats available, first come first served. Let us journey together toward sustainability! [Click to Register]
On October 16, A-shares spiked then pulled back, with dividend assets stepping in again late in the session, pushing the Shanghai Composite Index up 0.24% to close at 3,716.28 points. Tech stocks failed to recover, with the Shenzhen Component Index and ChiNext Index both posting a fifth consecutive decline. Total market turnover reached 1.57 trillion yuan, a slight contraction from the previous session.
The defense industry staged a strong rebound, leading the entire market! The underlying index of Defense ETF Huabao (512810) touched an intraday high of 4.35%. General aviation surged even more sharply, with Chenxi Aviation, Huali Chuangtong, and Inbol hitting the 20CM daily limit. The underlying index of General Aviation ETF Huabao (159231) once surged over 6% intraday before closing up 4.96%. On the news front, favorable policies for the low-altitude economy have been frequently introduced recently, and Tesla's "flying" car went viral during the session, causing related concept stocks' attention to skyrocket.
The real estate sector made a surprise move, with leading developers showing outstanding elasticity. Seazen Holdings rose over 8%, China Merchants Shekou gained more than 5%, and the underlying index of Real Estate ETF Huabao (159707) probed nearly 7% intraday, closing up 3.79% on heavy volume, with capital inflows clearly returning. The Index R&D and Investment Department of Huabao Fund believes this is not merely a sentiment-driven rebound but the result of three overlapping changes in policy, sales, and industry structure. Simply put: policy is being strengthened, sales are bottoming out, and capital is concentrating toward industry leaders.
Pharmaceutical assets saw unusual movement. In early trading, the full A+H innovative drug chain advanced, with the underlying indices of Hong Kong Stock Connect Innovative Drug ETF Huabao (520880) and Hong Kong Stock Connect Healthcare ETF Huabao (159137) probing 4.7% and 3.9% respectively. In the afternoon, WuXi AppTec plummeted suddenly, dampening sector sentiment and rapidly narrowing gains.
This week, the Shanghai Composite Index, ChiNext Index, STAR Composite Index, and STAR 50 Index declined 2.56%, 8.9%, 8.26%, and 6.77% respectively, all posting four consecutive weeks of losses. However, trading volume showed signs of recovery, with weekly turnover reaching 7.88 trillion yuan, the highest in nearly four weeks. Looking ahead, multiple institutions believe this round of A-share adjustment is more of a phased pullback under valuation digestion combined with liquidity constraints rather than a trend reversal. As trading volume gradually returns, the probability of the market shifting toward range-bound recovery may rise.
ETF Hotspot Closing Review
Below we focus on the trading and fundamental conditions of several thematic sectors including general aviation, real estate, and Hong Kong pharmaceutical stocks.
1. Musk's "Flying Car" Goes Viral! General Aviation Sees Wave of Limit-Ups, General Aviation ETF Huabao (159231) Underlying Index Surges Nearly 5% from Phase Bottom
The general aviation sector led gains strongly, with constituent stocks surging collectively. Chenxi Aviation, Huali Chuangtong, Inbol, Wanfeng Auto (rights protection), CITIC Offshore Helicopter, and multiple other stocks hit the daily limit. The underlying index of General Aviation ETF Huabao (159231), which provides one-click exposure to commercial aerospace + satellite navigation + low-altitude economy + large aircraft, once surged over 6% intraday before closing up 4.96%.
Figure 1: Top 10 daily gainers among constituent stocks of General Aviation ETF Huabao (159231) underlying index
Figure 2: Six-month trend of General Aviation ETF Huabao (159231) underlying index
Today's sector rally may be driven by the resonance of multiple catalysts: (1) Policy and top-level planning benefits. ① Hong Kong's major low-altitude economy plan: The Hong Kong Working Group on Low-Altitude Economic Development is fully committed to formulating the "Action Plan for Low-Altitude Economic Development," covering regulatory frameworks, standard-setting, and infrastructure, with drafting expected to be completed within the year. ② Breakthrough in international standards for low-altitude economy: The "Drone Perception and Obstacle Avoidance System" jointly led by China fills a gap in international standards in this field. ③ Continuation of central top-level guidance: The October 9 "Opinions on Developing New Quality Productive Forces" explicitly states "promoting the healthy and orderly development of the low-altitude economy and commercial aerospace under the premise of ensuring safety."
(2) Industry progress and commercial catalysts. ① Successful launch of the second batch of Qianfan constellation networking satellites: On October 15, the Long March 6A carrier rocket successfully sent the second batch of Qianfan constellation networking satellites into their designated orbits in a single launch of 18 satellites, bringing the total number of in-orbit networking satellites to 36. ② Successful "one rocket, ten satellites" launch of Zhuque-2: On October 14, Blue Arrow Aerospace's Zhuque-2 improved Y4 rocket sent 10 satellites including Guoxing Aerospace's Xing Shidai into their designated orbits. ③ Musk's "flying car" topic heats up: Tesla's next-generation Roadster was unveiled on the morning of October 16 at the SpaceX test base, marking the first mass-production passenger vehicle capable of autonomous lift-off and attitude control, boosting attention for flying cars and innovative mobility concepts.
(3) Zhuhai Airshow event catalyst. The 16th China International Aviation & Aerospace Exhibition is approaching. The Air Force will highlight iterative upgrades of main combat equipment, with multiple types of main combat equipment making their debut, an increased proportion of new-quality combat forces participating, and the Air Force pavilion setting up a "Digital Intelligence" section for the first time. Great Wall Securities notes that the industry's commercialization process is continuously accelerating, with related satellite communication application scenarios gradually being implemented. Against the backdrop of increasing commercial aerospace satellite launch frequency and maturing rocket reusability technology, the commercial aerospace rocket and satellite-related industry chain and component suppliers are viewed favorably. Longhua Securities notes that recently, progress in satellite internet and commercial aerospace has been密集, and the global space race is expected to accelerate, potentially driving increased demand across related industry chains.
Wings of a Great Power, Grand Prospects! The underlying index of General Aviation ETF Huabao (159231) and its feeder funds (Class A: 024766; Class C: 024767) comprehensively covers 50 aerospace constituent stocks, spanning hot sectors including low-altitude economy, commercial aerospace, satellite navigation, large aircraft, drones, and military aircraft. Among these, low-altitude economy concept exposure exceeds 90%, commercial aerospace exposure exceeds 60%, and satellite navigation concept exposure exceeds 45%, making it a powerful tool for one-click allocation to China's aerospace industry chain.
2. Explosive! Real Estate ETF Huabao (159707) Underlying Index Closes Up 3.79%! Policies Land Intensively, Huabao Fund: Leading Central SOEs May Become Core Beneficiaries
The real estate sector was active against the market trend, with leading developers showing outstanding elasticity. Seazen Holdings rose over 8%, China Merchants Shekou gained more than 5%, and Binjiang Group and Poly Developments rose over 4%. Among popular ETFs, Real Estate ETF Huabao (159707) suddenly saw heavy volume, with its underlying index probing nearly 7% intraday before rebounding to close up 3.79%, showing clear capital return.
Why the sudden activity? The Index R&D and Investment Department of Huabao Fund believes this is not merely a sentiment-driven rebound but the result of three overlapping changes in policy, sales, and industry structure. Simply put: policy is being strengthened, sales are bottoming out, and capital is concentrating toward industry leaders.
1. Policy: Central government's first direct interest subsidy sends a strong signal. Since late September, real estate policies have landed intensively. At the central level, the State Council Executive Meeting explicitly stabilized the housing market; the Ministry of Finance, the People's Bank of China, and other departments jointly issued documents, with the central government providing direct subsidies on mortgage interest for the first time, shifting the demand side from "lowering rates" to "direct fiscal subsidies." On the same day, the central bank lowered the PSL interest rate by 0.25 percentage points. At the local level, Beijing, Shanghai, Guangzhou, Wuhan, and Tianjin issued detailed rules for housing sales system reform, making the transition more flexible and mitigating short-term shocks; over 40 cities optimized provident fund policies, shifting from "loan-side easing" to "usage-side support." Overall, the system favors central SOEs and white-listed developers, further strengthening head concentration.
2. Sales: Golden September stabilizes, National Day recovers, but still bottoming. September new home transactions stabilized month-on-month but remained weak year-on-year. New home transactions in 50 cities totaled approximately 10.2 million square meters, up 2.4% month-on-month and down 20.1% year-on-year; second-hand home transactions in 20 cities totaled approximately 14.11 million square meters, up 3.1% year-on-year and up 6.5% cumulatively for the first nine months. Second-hand home resilience is clearly stronger than new homes. During the National Day and Mid-Autumn Festival holiday, driven by interest subsidies and increased supply, transaction volumes improved year-on-year: average daily new home transactions in 25 cities rose 33.8% year-on-year, and average daily second-hand home transactions in 11 cities rose 42.8% year-on-year. On prices, new home prices in 100 cities edged up month-on-month, while second-hand home prices continued to decline, though Shanghai's second-hand home prices turned from decline to gain. Sales rankings also show that among the top ten developers, 5 are central SOEs, 2 are local SOEs, 3 are mixed-ownership, and 0 are private enterprises, further strengthening head concentration.
3. Investment and model: Land acquisition contracting, development shifting toward "manufacturing-like" model. Under pre-sale housing sales and closed-end fund supervision, developer cash collection has slowed and capital occupation has increased, making land acquisition more cautious. In September, the top 100 developers' land acquisition amount fell 43% year-on-year, with land acquisition intensity at 45%, down 23 percentage points year-on-year. Only some leading central SOEs are still actively acquiring land. This means the industry is shifting from "high leverage, high turnover" to competing on products, quality, and earning premiums, increasingly resembling manufacturing. Central SOEs are expected to continue gaining share through advantages in capital, operations, and credit.
Overall, in the short term, the real estate sector is in a game period between policy strengthening and sales bottoming. The recent consecutive activity is a resonance of policy expectations, National Day sales recovery, and head concentration logic. In the medium to long term, the supply-side "controlling increments and destocking" and demand-side fiscal interest subsidies are forming synergy, and the supply-demand relationship is expected to improve. After the price bottom is established in core cities, prices may recover moderately, and industry resources will continue to concentrate toward the top, with leading central SOEs remaining the core beneficiaries.
To position in central SOEs and quality developers, it is recommended to focus on Real Estate ETF Huabao (159707). Information shows that Real Estate ETF Huabao (159707) tracks the CSI 800 Real Estate Index, gathering top-quality developers in the market with high central SOE exposure! Against the backdrop of industry consolidation, leading developers may have greater elasticity!
3. Hong Kong Stock Connect Innovative Drugs Stop Falling and Turn Upward, 520880 Underlying Index Probes 4.7%! WuXi AppTec Plummets Suddenly Late Session — What Happened?
Hong Kong pharmaceutical stocks finally stopped falling! In early trading, the full innovative drug chain counterattacked, with the underlying indices of Hong Kong Stock Connect Innovative Drug ETF Huabao (520880) and Hong Kong Stock Connect Healthcare ETF Huabao (159137) probing 4.7% and 3.9% respectively. In the afternoon, affected by the sudden plunge in WuXi-related stocks, gains narrowed, but they still closed up 1.94% and 0.19% respectively.
Figure: Six-month trend of Hong Kong Stock Connect Innovative Drug ETF Huabao (520880)
In terms of individual stock performance, on the innovative drug side, InnoCare Pharma-B was strong throughout the day, leading with a 10.89% gain. Weighted stock BeiGene closed up 4.36%, Kelun-Biotech and Insilico Medicine rose over 3%, and KeyMed Bio-B gained 7.62%. The 2026 European Society for Medical Oncology (ESMO) Annual Meeting will be held from October 23-27, with conference catalyst expectations heating up. On the CXO side, WuXi AppTec A-shares plunged sharply in late trading, touching the daily limit and closing down 6.66% on heavy volume. Its H-shares dipped nearly 8% before recovering, ultimately closing down 2.19%. Hong Kong-listed WuXi Biologics and WuXi XDC followed with spike-then-pullback and bottom-then-recovery patterns.
What happened? In the afternoon, reports emerged that "the US Biotechnology Innovation Organization (BIO) suddenly reversed its position, publicly supporting the Biosecure Act and removing WuXi AppTec's membership," rapidly triggering panic-driven stock plunges. Subsequent verification from multiple sources indicated the news was likely a re-publication of old news from March 2024, and Hong Kong WuXi-related stocks staged a V-shaped recovery late in the session.
Why is capital so sensitive? Since early September, accompanied by multiple positive factors including the lifting of BD restrictions, AI pharmaceutical catalysts, and a recovery in global innovative drug investment and financing, CXO has experienced a repair rally, with the sector accumulating relatively substantial profits. Recently, as market risk appetite has declined, concentrated profit-taking has easily triggered sentiment-driven sell-offs.
From a sector-wide perspective, Hong Kong pharmaceutical stocks were the first to initiate recovery today, and sustainability is worth anticipating. Overnight, US biopharmaceutical giants including AbbVie and Eli Lilly saw their stock prices once again approach historical highs. Foreign media reports suggest that AI's high volatility may be prompting capital to re-examine the allocation value of large pharmaceutical stocks. The core appeal of such companies lies in stable, predictable earnings growth — continuous investment in R&D pipelines, extending the patent lifecycle of core drugs, providing risk-return characteristics entirely different from tech stocks.
AI tide receding, pharma taking the baton? To capture high-elasticity opportunities in Hong Kong pharmaceutical stocks, focus on two T+0 trading tools: Hong Kong Stock Connect Innovative Drug ETF Huabao (520880): The underlying index has 100% allocation to innovative drug R&D companies, with 70% of positions betting on innovative drug R&D leaders. Off-exchange feeder fund: 025221. Hong Kong Stock Connect Healthcare ETF Huabao (159137): The underlying index has over 73% AI pharmaceutical exposure and nearly 60% CXO exposure. Off-exchange feeder fund: 026922.
[Data Source] Public information from Shanghai-Hong Kong-Shenzhen exchanges, China Securities Index Company, Hang Seng Index Company, etc. Weight data as of September 30, 2026.
[Notes on "AI Pharmaceutical Exposure" and "CXO Exposure"] The Hong Kong Stock Connect Healthcare Theme Index tracked by Hong Kong Stock Connect Healthcare ETF Huabao covers 17 AI pharmaceutical-related constituent stocks (including pure AI pharmaceutical platforms, AI+CRO, and innovative drug companies deploying AI pharmaceuticals), with a combined weight of 73.04%, of which CXO companies account for 59%.
[Institutional Views] 1: Great Wall Securities, October 12, 2026, "Humanoid Robot Competitive Transformation, Commercial Aerospace In-Orbit Verification"; Longhua Securities, October 12, 2026, "Global Space Race Expected to Accelerate, Focus on Commercial Aerospace Industry Chain Opportunities."
[Fund Fee Rates] ETF funds do not charge sales service fees. When investors subscribe or redeem fund shares, the subscription/redemption agent broker may charge a commission of no more than 0.5%, which includes related fees charged by stock exchanges, registration institutions, etc. Fund fee rates are detailed in each fund's legal documents.
[Special Notice] According to the fund manager's assessment, the risk levels of Hong Kong stock ETFs are all R4-medium-high risk, suitable for aggressive (C4) and above investors. The risk levels of other funds mentioned in this article are all R3-medium risk, suitable for balanced (C3) and above investors. Suitability matching opinions should be based on the sales institution's assessment.
[Risk Disclosure] Individual stocks mentioned in this article are only objectively listed as index constituent stocks and do not constitute any individual stock recommendation, nor do they represent the fund manager or fund investment direction. Any information appearing in this article (including but not limited to individual stocks, comments, predictions, charts, indicators, theories, and any form of expression) is for reference only, and investors must be responsible for any investment decisions they make independently. Additionally, any views, analyses, and predictions in this article do not constitute any form of investment advice to readers, and the company assumes no responsibility for direct or indirect losses caused by the use of this article's content. Investors should carefully read fund legal documents such as the "Fund Contract," "Prospectus," and "Fund Product Information Summary" to understand the risk-return characteristics of the fund and choose products suitable for their own risk tolerance. Past performance of funds does not predict future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of fund performance. Sales institutions (including the fund manager's direct sales institution and other sales institutions) conduct risk assessments of the above funds in accordance with relevant laws and regulations. Investors should promptly follow the suitability opinions issued by the fund manager. Suitability opinions from various sales institutions may not necessarily be consistent, and the fund product risk level assessment results issued by fund sales institutions shall not be lower than the risk level assessment results made by the fund manager. There are differences between the fund contract's description of fund risk-return characteristics and fund risk levels due to different consideration factors. Investors should understand the risk-return situation of funds, carefully select fund products based on their own investment objectives, time horizon, investment experience, and risk tolerance, and bear risks themselves. The registration of the above funds by the China Securities Regulatory Commission does not indicate its substantive judgment or guarantee of the investment value, market prospects, and returns of the above funds. Fund investment involves risks.
Comments