A-share market express at the opening bell | A-share counterattack, three major indices rise more than 1%! Steel sector is up again.

On September 24, the policy rolled out a "combination of punches": lowering reserve requirements and interest rates, reducing existing housing loans, promoting mergers and acquisitions and reorganizations, and six other measures... Stimulated by the news, the three major A-share indexes all rose more than 1% at one point, but the gains narrowed afterwards. As of the time of publication, the Shanghai Composite Index rose by 0.86%, the Shenzhen Component Index rose by 0.48%, and the ChiNext Index rose by 0.6%. In terms of the market, the steel sector rose again, with Guangdong Zhongnan Iron & Steel up for two consecutive days. Real estate stocks were active at the opening, with CCCG Real Estate Corporation hitting the limit up, Shenzhen SDG Service and 5i5j Holding Group up by more than 5%. Photovoltaic stocks rebounded, with Hongyuan Green Energy hitting the limit up. Brokerages, insurance, and diversified financial directions were all strong, with Anhui Xinli Finance rising by competitive bidding limit. Liquor stocks rose, with Shanghai Guijiu up by more than 7% and Wuliangye Yibin up by more than 3%. Yonghui Superstores hit limit up, and MNSO acquired a 29.4% stake to become the largest shareholder. The Huawei industrial chain was sluggish at the opening, with Shenzhen Huaqiang Industry limit down and Wuhan P&S Information Technology down by more than 4%. In terms of main fund flows, funds favored liquor, securities, and photovoltaic equipment industries, while funds fled from power grid equipment and software development industries. Institutional Views: Looking ahead, CICC's research report stated that the recent high volatility in the US stock market demonstrates the resilience of the bull market style, and the "broad fiscal policy + loose monetary policy" is pushing the pro-cyclical sectors to perform well. CICC: Bull Market, Pro-cyclical, and State-owned Enterprises are expected to continue to perform well CICC's research report stated that the recent high volatility in the US stock market demonstrates the resilience of the bull market style, and the "broad fiscal policy + loose monetary policy" is pushing the pro-cyclical sectors to perform well. Expectations of the Fed rate cut have increased, and the advantages of the bull market style have become more prominent in high volatility. In the A-share market, the market is mainly influenced by domestic fundamentals, and the bull market style is converging toward state-owned enterprises. State-owned enterprises, with stable demand and reform dividends, demonstrate high growth potential and cash flow premium. It is expected that the combination of "bull market + pro-cyclical" will continue to maintain its advantage in both markets. Huatai: Game sector gradually coming out of the bottoming phase Huatai pointed out that in August 2024, the total revenue of the domestic game market was 33.64 billion yuan, a year-on-year increase of 15.1% and a month-on-month increase of 21.01%. Among them, the sales revenue of self-developed games was 27.261 billion yuan, a year-on-year increase of 8.35% and a month-on-month increase of 32.9%, mainly due to "Black Myth: Wukong" bringing a significant increase in sales to stand-alone and console games. The game sector is gradually coming out of the bottoming phase, with marginal changes including: 1. New product expectations (supporting EPS upside space); 2. Policy stability (positive propaganda of domestic games by official media, supporting the continued recovery of valuations). The new products of leading game companies in the second half of 2024 and 2025 are expected to contribute significant performance elasticity. China Securities Co., Ltd.: Huawei Mate XT, Huawei's first folding phone, begins first batch delivery. Continuously monitor the pace of Huawei's new product releases and sales, as well as domestic suppliers expected to benefit. Hot Sectors: 1. The steel sector rose again The steel sector rose again, with Guangdong Zhongnan Iron & Steel up for two consecutive days, and Bengang Steel Plates, Anyang Iron and Steel, Xinjiang Ba Yi Iron & Steel, Nanjing Iron & Steel, and Angang Steel following suit. Comments: On September 23, the National Development and Reform Commission held a special press conference, where Deputy Director General Zhao Chenxin revealed that China Resources Recycling Group is being set up to establish a national and functional resource recycling platform. China Baowu's waste steel recycling business is expected to be integrated into a new central enterprise, providing tangible support for promoting recycling. 2. Real estate sector strengthened The real estate sector opened strong, with CCCG Real Estate Corporation hitting the limit up, and Gemdale Corporation, Cinda Real Estate, Langold Real Estate, China Merchants Shekou Industrial Zone Holdings, and Seazen Holdings all opening higher. Comments: Open Source Securities pointed out that as the traditional sales peak season in September approaches, market activity may continue to rise, but the land acquisition contraction by mainstream real estate companies in the first half of the year may affect the scale of inventory supply and the recovery process of sales. It is expected that under the low base effect, the decline in real estate sales is expected to continue to narrow, and various destocking policies are expected to help stabilize and establish a bottom in the housing market. Continuously optimistic about strong credit real estate companies with high investment intensity, superior regional layouts, and market-oriented mechanisms. 3. Mergers and reorganizations concept stocks remained active Mergers and reorganization concept stocks remained active, with Henan Yicheng New Energy hitting the limit up, and Jilin Yatai, Hainan Shuangcheng Pharmaceuticals, SEC Electric Machinery, Anhui Xinli Finance hitting the limit up, Shenzhen Infogem Technologies up by more than 10%, and Qiming Information Technology and Chongqing.Millison Technologies Inc. and Hanjia Design Group have increased by over 5%.Review: On the news front, Wu Qing, Chairman of the China Securities Regulatory Commission, stated on September 24th that the commission will take multiple measures to invigorate the mergers and acquisitions market. They will release measures to promote mergers and acquisitions, and make efforts to facilitate fundraising, management, and exit for private equity and venture capital funds. 4. Strong performance in the financial sector Brokerages, insurance companies, and diversified financial institutions all showed strength. Anhui Xinli Finance hit the limit up, while Guangdong Golden Dragon Development Inc., Tianfeng, China Galaxy, Guosheng Financial Holding Inc., Kunwu Jiuding Investment Holdings, AVIC Industry-Finance Holdings, Hubei Biocause Pharmaceutical, and Ping An Insurance followed the upward trend. Commentary: On the news front, Pan Gongsheng, Governor of the People's Bank of China, announced on September 24th at a press conference that they will facilitate exchanges between securities, funds, and insurance companies to support those eligible to access liquidity from the central bank through asset pledging. This move is expected to significantly increase their funding and stock holding capabilities. This article is reproduced from "Tencent Stock Selection", edited by Liu Jiayin.