To The Moon

GF Securities has released a research report stating that based on the actual market and style performance in 2026, combined with historical patterns, it offers an outlook for the market around the National Day holiday in 2026. First, with only three trading days remaining before the holiday, there is little need to further reduce positions at this level, and doing so would risk missing potential post-holiday rebound opportunities. After the market's volume contracted by 50% from its July high, trading activity has stabilized somewhat; volume is expected to recover after the holiday, making an effective rebound more likely at this level. Beyond the "calendar effect," historical post-holiday market performance is mainly influenced by incremental information during the holiday period. Historically, in the first week after the holiday, TMT has had the highest probability of outperforming the broader A-share market among major style indices. Combined with this year's actual style performance, the market is expected to gradually return to fundamental-driven pricing in October, meaning that if growth styles see further adjustment in the final week before the holiday, it would present a rare positioning opportunity for Q4. Priority should be given to the AI supply chain with strong third-quarter earnings momentum, as well as niche alpha opportunities outside of AI, including pharmaceuticals, shipping, shipbuilding, and select segments of the export chain.

The main views of GF Securities Co.,Ltd. (000776) are as follows. For long holidays such as the Spring Festival and National Day, A-share investors often debate whether to "hold cash" or "hold stocks" over the holiday. In essence, the firm recommends reducing such short-term speculation, but it is still necessary to review the speculative process clearly to better understand short-term market fluctuations. Based on data from 2011 to 2025 (excluding the September 24, 2024 period), the firm summarizes the historical patterns as follows.

1. From a volume perspective: One to two weeks before a long holiday, A-share trading volume contracts by 25-30%, and recovers in the week after the holiday. The main reasons include investors' concerns about overseas uncertainties during the holiday and leveraged funds reducing positions because margin interest must be paid on a calendar-day basis. 2. From a broad-based index price perspective: Most indices (Wind All A, ChiNext Index, CSI 1000) perform weakly one to two weeks before the National Day holiday, stabilize in the two trading days before the holiday, and rebound in the first week after the holiday. The STAR 50 shows mixed performance before the holiday, driven by industry-specific pricing. 3. Over the past 15 years, in 13 of those years, the post-holiday closing price rebounded by more than 2% from the pre-holiday low. In other words, if investors positioned on dips before the holiday, the win rate for making money after the holiday exceeded 80%. 4. Sector performance: TMT has the highest probability and average excess return of outperforming the broader market in the week after the holiday, with a win rate of 73%. 5. Industry performance: Combining post-holiday one-week rebound probability and average excess return, the top sectors are computers, agriculture, textiles and apparel, and chemicals.

Based on the actual market and style performance in 2026, combined with historical patterns, the outlook for the market around the National Day holiday in 2026 is as follows. 1. First, with only three trading days remaining before the holiday, there is little need to further reduce positions at this level, and doing so would risk missing potential post-holiday rebound opportunities. 2. After the market's volume contracted by 50% from its July high, trading activity has stabilized somewhat; volume is expected to recover after the holiday, making an effective rebound more likely at this level. 3. Beyond the "calendar effect," historical post-holiday market performance is mainly influenced by incremental information during the holiday period. Looking ahead to the economic and policy environment at home and abroad in 2026, the market has already fairly fully anticipated and priced in several negative factors, and news flow during the 2026 National Day holiday is expected to be largely stable, including Federal Reserve rate hike expectations, AI industry developments, and China-U.S. meetings. 4. Historically, in the first week after the holiday, TMT has had the highest probability of outperforming the broader A-share market among major style indices. Combined with this year's actual style performance, the market is expected to gradually return to fundamental-driven pricing in October, meaning that if growth styles see further adjustment in the final week before the holiday, it would present a rare positioning opportunity for Q4, given the earnings momentum advantage in third-quarter reports and a series of catalysts in the AI supply chain. 5. The allocation recommendation is maintained: priority should be given to the AI supply chain with strong third-quarter earnings momentum, as well as niche alpha opportunities outside of AI, including pharmaceuticals, shipping, shipbuilding, and select segments of the export chain. For dividend sectors, there is still a win rate, but the expected return space is less than at the 630 level.