Northbound Capital Rebalances in Q3; Holdings in Banking and Pharmaceuticals Surge

On October 14, data on A-share holdings at the end of Q3 2026 for the Shanghai-Hong Kong Stock Connect was released, revealing Northbound capital's movements during the quarter. According to Wind data, as of the end of Q3 2026, Northbound capital held shares in 3,531 individual stocks with a total holding value of 2.577 trillion yuan, a decline of over 550 billion yuan from the end of Q2 (3.127 trillion yuan), but roughly flat compared to the end of Q1 (2.572 trillion yuan). In terms of structure, Northbound capital increased its allocation significantly to dividend-paying and pharmaceutical sectors while reducing exposure to AI and overseas expansion chains. By sector, Northbound capital's holdings in the banking sector rose sharply by 67.336 billion yuan compared to the previous quarter, a 47% increase that topped all 31 industries classified under the Shenwan system, coinciding with an overall index gain of over 16% for the banking sector. Additionally, Northbound capital holdings saw significant increases in other major financial and consumer sectors including pharmaceuticals and biotechnology, non-bank finance, transportation, home appliances, and food and beverages.