Institutions Say Market Is Incubating a Rebound; Earnings Certainty Becomes Key Allocation Theme

Last week, A-shares continued to trade in a volatile and weakening trend, with tech growth sectors such as computing hardware, semiconductors, and CPO continuing to correct, while the CSI Dividend Index rose against the trend, and heavyweight sectors including banks, petrochemicals, coal, and food and beverages held up relatively well. Market sentiment rebounded first in November, and on November 2, major A-share indices rose collectively. Institutional sources interviewed by reporters believe that tight external liquidity and continued suppression of short-term risk appetite mean the market will inevitably fluctuate, but A-shares are in an incubation period for a rebound rather than the end of the rally. Earnings in the third-quarter reports continue to recover, and industrial capital is buying back and increasing holdings with real money, confirming the bottom area and providing medium-term support. As external uncertainty clears, risk appetite is expected to recover. In terms of strategy, institutions recommend building a base with dividend assets and relaying with high-quality growth stocks, seizing the short-term recovery window, anchoring to earnings certainty in the medium term, and positioning opportunistically as risk appetite recovers. (China Securities Journal)