Essence of securities morning meeting | After a sharp rise in the stock market, there may be short-term setbacks, but it is expected that the rebound will continue.

The market surged on heavy volume all day yesterday, with all three major indexes rising by more than 4%. The Shanghai Composite Index saw its largest single-day increase since July 6, 2020. The total transaction volume in the Shanghai and Shenzhen stock markets reached 971.3 billion, an increase of 420.3 billion from the previous trading day, with over 5,100 stocks in the market rising. Leading sectors included diversified finance, steel, securities, and liquor, with no declining sectors. By the end of the day, the Shanghai Composite Index was up 4.15%, the Shenzhen Component Index was up 4.36%, and the ChiNext Index was up 5.54%. At today's brokerage morning meeting, CICC believes that there may be some setbacks in the short term after the stock market surge, but the rebound is expected to continue; China Securities Co., Ltd. pointed out that the matrix policy combination has had a significant effect beyond expectations; Western indicated that the financial policy combination this time covers three core directions and is expected to bring more liquidity support to the market. CICC: Short-term setbacks may occur after the stock market surges, but the rebound is expected to continue CICC pointed out that the A-share market turned to marginal rebound in September, and the rebound is expected to continue. The Fed announced a rate cut on September 18, opening a rate cut cycle. The reaction in the Hong Kong stock market was more significant, and A-shares also rebounded. On September 24, the National Development and Reform Commission released a positive signal for stabilizing the economy, the market, and expectations, leading to a significant improvement in investor risk appetite. The current valuation of the A-share market is at an extreme level, with the Shanghai and Shenzhen 300 Index's forward valuation near historical lows. The A-share turnover rate based on free float market capitalization is at historical lows of about 1.5% (historically 1% to 2%) during the period of historical lows. Against this background, the appearance of positive policy signals is expected to boost investor sentiment. After the stock market surged on September 24, there may be some short-term setbacks, but the rebound is expected to continue. The market trend's stabilization still needs to keep an eye on changes in the fundamental expectations of listed companies. China Securities Co., Ltd.: Matrix policy combination with significant effects beyond expectations China Securities Co., Ltd. pointed out that the three major financial departments are supporting high-quality development in a matrix-style combination manner, focusing on providing "real money and silver" financial support and "addressing fundamental issues and strengthening foundations" in terms of institutional construction, concentrating on the real economy, real estate market, and capital market. By lowering reserve requirements and interest rates and lowering existing home loan rates, it can encourage long-term liquidity release by banks, potentially driving growth in consumer spending. Five real estate financial policies are in full force, and future attention will still be required on the effectiveness and implementation of the policies. The People's Bank of China has historically created stock market monetary policy tools for the first time, including non-bank financial institutions' repurchase agreements and stock repurchase loans, providing strong support for the activity and performance of the capital market. This round of policy exhibits strong foresight and integrated efforts, exceeding market expectations, and is expected to continue to drive the real economy and capital market toward improvement. Western: The financial policy combination this time covers three core directions and is expected to bring more liquidity support to the market Western stated that on September 24, the State Council Information Office held a press conference where the heads of the People's Bank of China, the China Banking and Insurance Regulatory Commission, and the China Securities Regulatory Commission introduced financial support policies for high-quality economic development and announced a series of policies. These policies support high-quality development through various measures and provide clear positive signals. The financial policy combination this time covers three core directions of monetary, real estate, and capital market policies, with the implementation of reserve ratio cuts and interest rate reductions combined with support for real estate and stock markets, among other measures, aiming to create a good monetary and financial environment for stable and high-quality economic development, helping to improve liquidity expectations, boost market confidence, and improve risk appetite. This press conference is expected to bring more liquidity support to the market, leading to improved risk appetite among investors and promoting stable market operations. Deepening capital market reforms and promoting high-quality development in the industry are expected to facilitate fundamental and valuation repairs in the non-bank sector. Currently, the valuation and holdings of the non-bank sector are at industry lows, and it is recommended to pay attention to opportunities for sectoral repair amid improved market sentiment.