Cinda: The upward trend that began before the Spring Festival is likely to develop into the second wave of a bull market.

Cinda released a research report stating that the rise that began before the Spring Festival has a high probability of developing into the second wave of a bull market. In the initial stages, there will be some seasonal impact due to restrictions from last year's high point. The adjustment last week was mainly due to the seasonal reduction of speculative funds before the Two Sessions and excessive trading in certain areas (low AH premiums, high proportion of TMT trading), with a high probability of about 2 weeks of volatility. The concerns about US tariff policies last week are not the core contradiction of the market adjustment, and even if there are changes in the future, it will not have a significant impact on the market. In the next month, the suggested allocations are: Hong Kong internet stocks (increased overseas volatility, rising Chinese asset allocation appetite) > Steel construction (policy-driven valuation repair of broken net stocks) > Financial real estate (waiting to verify post-Spring Festival real estate data). Cinda believes that since mid-January, the economic-related sectors have lagged in terms of growth, and the usual economic expectation frenzy during the spring season has not yet occurred. Based on the Citibank China Economic Surprise Index, the economic data in March and April each year often fluctuates significantly compared to expectations. Given the current cautious economic expectations, this kind of fluctuation is more likely to bring about an increase. From a longer-term perspective, there are more signs of market breakthroughs in terms of profit and incremental funding levels. Social financing, PMI, and second-hand property sales have improved, interest rates have rebounded significantly, financing balances have risen rapidly, and reached historical highs. However, due to the lack of seasonal strength and the intensity of the rebound, further confirmation is needed by the latter half of March. (1) Short-term reasons for fluctuations: seasonal and local overheating of short-term trading. The seasonal pattern in Q1 of A shares is often significant. Investors typically experience the strongest seasonal phase from Spring Festival to the Two Sessions. As the Two Sessions approach, the win rate tends to decrease slightly, with a win rate of only 41% during the Two Sessions. The market weakeni(...)Rotation towards the large-cap stocks. From September to December 2014 and January to June 2015, the market style leaned towards large-caps. Looking at the current situation, Cinda believes that towards the end of the market fluctuations, before the next round of rise, there will likely be a rotation towards large-caps. It is recommended to reallocate growth internally to Hong Kong-listed internet companies, and focus on index weights (banks) and undervalued stocks (steel) in terms of value."Hola, cmo ests?"