In recent times, influenced by factors such as the transmission of external market volatility, the A-share market has experienced periodic adjustments. Several public and private fund institutions, including E Fund, China AMC, Fullgoal Fund, Southern Fund, China Europe Ruibo, and Lerui Asset, while analyzing market changes, have firmly expressed optimism about the long-term investment value of A-shares.
Positive factors remain unchanged
Lerui Asset believes that since October, unfavorable factors such as rising credit risk premiums on overseas tech stocks and fluctuating energy prices have intertwined, impacting global stock markets. In the face of external shocks and changes in short-term risks, it is necessary to respect market operating rules and rationally view changes in risk appetite, while also returning to China's economic fundamentals and recognizing the long-term value of Chinese assets.
Jia Jian, General Manager of the Equity Investment Management Department and General Manager of the Research Department at E Fund, told the reporter that when looking at market changes, one should not only focus on short-term fluctuations but also grasp long-term trends. From the perspective of continuous deepening of capital market reforms, improvement in the fundamentals of listed companies, and current valuation levels, the positive factors for the long-term healthy development of China's capital market have not changed.
Xuan Wei stated that the high-quality development of the domestic economy provides solid support for the capital market, new quality productive forces are accelerating cultivation and achieving fruitful results, and the innovation-driven positive feedback mechanism is continuously strengthening, providing a solid value foundation and underlying asset support for this round of market trends.
From the perspective of the profit composition of listed companies, Chen Jie, Assistant General Manager and General Manager of the Equity Research Department at Fullgoal Fund, told the reporter that the profit composition of listed companies has shifted from being dominated by traditional "two high and one resource" industries to being dominated by new quality productive forces industries. In Jia Jian's view, technological innovation and industrial upgrading are gradually translating into the operating results of listed companies.
Attention to market valuation
While fundamentals are improving, multiple institutions are also focusing on whether the earnings quality of listed companies can be sustained. Data from the 2026 interim reports show that the overall trailing twelve-month ROE of A-share listed companies stands at 8%. Chen Jie believes that the rebound in ROE may indicate that the sustainability of this round of profit improvement is worth anticipating, and shareholder returns are also expected to increase.
Jia Jian believes that market valuations are at relatively low levels, and the long-term allocation value of equity assets is further emerging. He analyzed that currently, the price-to-earnings ratio of the CSI 300 Index is less than 13 times, significantly lower than the current valuation levels of international comparable indices such as the S&P 500 and the Nikkei 225. The price-to-earnings ratio of the ChiNext Index, which represents emerging industries, has fallen back to approximately the 16th percentile since 2015, and its long-term allocation value has gradually become apparent.
Wu Weizhi, Chairman and Chief Investment Officer of China Europe Ruibo, stated that the weight of Chinese equity assets in the MSCI Global Index is lower than China's economic size as a proportion of the global total, and overseas long-term funds have a relatively low allocation ratio to Chinese equity assets.
Emphasis on industrial trends
Judgments on medium- to long-term market trends also need to be grounded in the industrial and institutional levels. Zheng Xiaoxi, a fund manager in the Equity Investment Department at Southern Fund, analyzed that the external policy environment is continuously changing, and coupled with the strong pull from AI industry innovation demand, the domestic semiconductor industry continues to break through key bottlenecks, and the direction of capacity expansion in the advanced process supply chain is becoming increasingly clear.
Wu Weizhi stated that China has already formed distinctive features in the open-source model ecosystem, the speed of application implementation, and a complete industrial chain. In addition, the increase in the penetration rate of new energy vehicles and the rising proportion of green electricity have effectively hedged against the cost pressures brought by international energy price increases, enhancing the economy's internal stability.
Changes at the institutional level are also improving the market ecosystem. Jia Jian believes that capital market reforms continue to show results, and the investment and financing functions are becoming more coordinated. On the investment side, reforms have achieved important breakthroughs, and the endogenous forces promoting the stable development of the market are continuously strengthening. On the one hand, the sources, channels, and methods of medium- and long-term capital entering the market are continuously broadening, and long-cycle assessment mechanisms are being established at a faster pace. On the other hand, the governance level of listed companies continues to improve, and dividend and buyback mechanisms as well as investor return mechanisms are increasingly sound. On the financing side, the inclusiveness and adaptability of systems such as issuance and listing, mergers and acquisitions, and restructuring have significantly increased, better serving the financing needs of enterprises of different types and at different development stages, and promoting the accelerated concentration of financial resources in areas of technological innovation and new quality productive forces.
In Xuan Wei's view, the basic systems of the capital market are continuously being improved, and the "1+N" policy system for the capital market is being implemented and taking effect, which is reshaping the investment ecosystem of the capital market. Supervision of listed companies is becoming stricter, and market value management, buyback, and dividend mechanisms are continuously being refined.
Overall, the statements from the above institutions have different emphases. Short-term disturbances remain, and external uncertainties have not disappeared, but the resilience of economic fundamentals, the improvement in the earnings quality of listed companies, the relative attractiveness of market valuation levels, the continuous advancement of industrial upgrading, and the optimization of the capital market's institutional ecosystem together constitute the support for the long-term investment value of A-shares.
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