Cathay Pacific Haitong: The New Year's Eve offensive has begun to be optimistic about technology, brokerage and consumption

The Zhitong Finance App learned that Cathay Pacific Haitong Securities released a research report saying that considering the recent decline in economic activity and the acceleration of the decline in real estate sales area, policy expectations are expected to improve. On the premise that the RMB is stable, expectations that the Central Bank of China will cut interest rates in early 2026 are expected to increase. At the transaction level, guaranteed profit reduction positions have come to an end. The reallocation and return of institutional capital at the end of the year and the beginning of the year are expected to improve market liquidity and active transactions. The New Year's Eve offensive has already begun. After taking the lead and entering the New Year's Eve offensive, Cathay Pacific Haitong is optimistic about technology, brokerage, and consumption.

Cathay Pacific Haitong's main views are as follows:

After a long period of sideways fluctuation, China's “transformation bulls” will regain their strength and rise to the next level. On November 24, when the Shanghai Composite Index fell to 3,800 pessimistic points, the Cathay Pacific Haitong Strategy Team judged the “key position: entering the batting zone and playing first hand”. The GEM index has basically recovered its losses in the past two weeks. As for the future market, Cathay Pacific Haitong is more optimistic than market consensus: there is a mistake that some investors are not actively interpreting policies in a “cross-cycle” manner; unconventional 2025 is compared to risk exposure at the end of 2024. Facing 2026, the Central Economic Work Conference clearly “consolidates and expands the steady, moderate and positive momentum of the economy”, and calls for fiscal policy to be “more active” and “lead domestic demand”, first proposed “driving investment to stop falling and stabilizing” (negative growth in 2025), and reintroduce real estate “inventory removal” after a period of ten years; Han Wenxiu, deputy director of the China Finance Office, said that he will introduce and implement incremental policies in line with changes in the situation, and continue to implement “state subsidies” and advance implementation of the “15th Five-Year Plan” key projects, implying the importance of achieving a good start to the “15th Five-Year Plan”. Considering the recent decline in economic activity and the acceleration of the decline in real estate sales area, policy expectations are expected to improve. On the premise that the RMB is stable, expectations that the Central Bank of China will cut interest rates in early 2026 are expected to increase. At the transaction level, guaranteed profit reduction positions have come to an end. The reallocation and return of institutional capital at the end of the year and the beginning of the year are expected to improve market liquidity and active transactions. The New Year's Eve offensive has already begun.

Spring market rules: singing on the big set and small, and the high quality main line takes the lead. Reviewing the spring market pattern from 2010 to now: 1) The spring market usually focuses on December of the previous year to April of the following year, and the empirical starting point is 10-15 trading days before the Spring Festival. If the market is fully adjusted in the early stages and policy and liquidity expectations improve, the launch period will be significantly earlier, such as 12-13, 18-19, 22-23; 2) The spring market style is characterized by setting up the stage and singing on a small plate, with a watershed near the Spring Festival. Prior to that, influenced by annual report forecasting pressure, insurance capital allocation preferences, etc., the market style represented by the China Securities 800 had an advantage; after the Spring Festival, it entered a period of empty economic and performance, compounded by seasonal improvements in the liquidity environment, and small to medium growth represented by the China Securities 2000 outperformed significantly; 3) If the strong main line of the previous year was still supported by the boom at the beginning of the year, high certainty would take the lead in initiating a “valuation switch” and rushing the market to rise. For example, games in early '14, Internet + in early '15, semiconductors in early '20, and Mao Index in early '21. Considering the drastic stock index adjustments in the previous period, the increase in total volume policies, and the incremental market entry environment, now is an important window for planning the spring market. Market growth with industrial trends before the Spring Festival is expected to prevail, and market value benefiting from the “good start” allocation of insurance capital is also expected to rebound.

Industry comparison: After stepping out of the game, entering the New Year's Eve offensive: optimistic about technology, brokerage, and consumption. The Central Economic Work Conference continues its positive macroeconomic policy stance, focusing on short-term expansion of domestic demand and medium- to long-term “internal skills” training, and combining them to increase aggressiveness. Optimistic: 1) Technological growth: AI models and applications are progressing rapidly, and domestic computing power infrastructure is in short supply. Recommended: Hong Kong stock internet/media/computer/computing power, and manufacturing with a global competitive advantage going overseas: electric equipment/mechanical equipment. 2) Big finance: In-depth capital market reforms are expected to revive the trend. Recommended: broker/insurance. 3) Procyclical cycle: After three years of adjustment, valuations and positions are low, and consumer sector sentiment clues have increased. Consumer stocks with low stock prices, low inventory, and improved sentiment are recommended: food and beverage/agriculture, forestry, animal husbandry, fisheries/hotels/travel services; the cycle is optimistic about colors/chemicals.

Recommended topics: 1. Commercial aerospace: The launch of the Long March XII rocket is about to accelerate with the constellation. I am optimistic about the liquid rocket/satellite payload/launch site. 2. Energy powerhouse: Expanding the application of green power has become a strategic energy priority, and is optimistic about smart grids/new energy storage/nuclear fusion energy. 3. AI application: The central government proposed deepening the expansion of artificial intelligence+, and is optimistic about Hong Kong stock internet/data center electricity. 4. Domestic consumption: Build a strong domestic market and be optimistic about emerging consumption/event economy/snow and ice tourism.

Risk warning: Overseas economic recessions have exceeded expectations, and global geopolitical uncertainty.