On October 13, the defense sector kicked off its rally before noon and kept climbing throughout the afternoon, leading gains across both markets! The CSI Military Industry Index once surged past 3%, and the Defense ETF Huabao (512810), which tracks the index, moved higher in tandem. Constituent stocks staged a broad reversal, with Jiangxi Guoke Defence Group Co.,Ltd. (688543) jumping over 13%, Jiangxi Hongdu Aviation Industry Co.,Ltd. (600316) sealing the limit-up board, and AVIC Chengdu Aircraft up 9%.
On the news front, the 16th China International Aviation and Aerospace Exhibition will be held in Zhuhai from December 7 to 13, 2026, with more than 1,100 exhibitors and about 10% of exhibits making their debut or first appearance. Analysts noted that the defense sector's rally may be driven by a combination of four factors: oversold rebound, third-quarter earnings expectations, geopolitical catalysts, and institutional support. The CSI Military Industry Index fell in 8 of the past 9 trading sessions, leaving technical conditions severely oversold. Combined with the approaching third-quarter earnings window and persistently tense global geopolitics, a large return of capital drove the strong rebound.
Looking ahead, expectations for the 15th Five-Year Plan, catalysts from the Zhuhai airshow, and the continued landing of overseas military trade orders are expected to provide sentiment support for the sustainability of the rebound. Orient Securities explicitly stated, "We are bullish on a Q4 rebound opportunity in the defense sector."
For defense exposure, choose the "August 1st" code. The Defense ETF Huabao (512810) (formerly the National Defense Military Industry ETF), whose code contains "August 1st," passively tracks the CSI Military Industry Index, providing comprehensive coverage of hot themes such as commercial aerospace, low-altitude economy, large aircraft, MLCC, military AI, and gas turbines.
Data source: public information from the Shanghai and Shenzhen Stock Exchanges, China Securities Index Co., and others. Institutional view: Orient Securities, June 29, 2026, "National Defense and Military Industry Weekly: Bullish on a Q4 Rebound Opportunity in the Sector." Fund fee rates: When investors subscribe to or redeem fund shares, the subscription and redemption agent may charge a commission of no more than 0.5%, which includes related fees charged by the stock exchange and the registrar.
Special note: The risk rating assessed by the fund manager for the Defense ETF Huabao is R3-Medium Risk, suitable for balanced investors (C3) and above. Risk disclosure: The Defense ETF Huabao passively tracks the CSI Military Industry Index. The index's base date is December 31, 2004, and it was launched on December 26, 2013. Its annual historical returns/annualized volatility for 2021-2025 were: 14.28%/33.05%, -25.74%/23.44%, -11.02%/18.34%, 8.20%/34.39%, and 31.55%/21.43%, respectively. The composition of the index's constituent stocks is adjusted in due course according to the index compilation rules, and past performance does not predict future results. The weights of the individual stocks mentioned in this article within the CSI Military Industry Index are shown in the accompanying chart, with data as of July 31, 2026.
Descriptions of individual stocks do not constitute investment advice in any form, nor do they represent the holdings or trading activities of any fund managed by the manager. The composition of the underlying index's constituent stocks is adjusted in due course according to the index compilation rules. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, and any form of expression) is for reference only, and investors must be responsible for their own investment decisions. In addition, any views, analyses, and forecasts in this article do not constitute investment advice of any kind to readers, nor shall they bear any responsibility for direct or indirect losses caused by the use of the content herein. Fund investment involves risks, past performance of a fund does not represent its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of the fund's performance. Fund investment requires caution. A MACD golden cross signal has formed, and these stocks are performing well!
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