CMSC: Hong Kong stock market initially suppresses and then rises, focusing on four attacks + two bottom positions.

CMSC released the monthly report on the Hong Kong stock market strategy, stating that looking ahead, the fourth quarter is expected to start with a downturn and then rebound. In the short term, in the absence of positive catalysts, the Hong Kong stock market may continue its volatile trend. However, as positive factors accumulate in the future, driving factors such as the easing of tariff issues, the incremental policies from the Fourth Plenary Session of the CPC Central Committee's "14th Five-Year Plan", and the strengthening expectation of interest rate cuts by the Federal Reserve attracting foreign capital inflows, combined with the structural prosperity of the new economy, are expected to support the upward trend of Hong Kong stocks. The focus for allocation includes the four offensive sectors (mining/technology/power/insurance) and two defensive sectors (turnaround/ dividend stocks). In the fourth quarter, Hong Kong stocks are expected to start with a downturn and then rebound. In the short term, in the absence of positive catalysts, the Hong Kong stock market may continue its volatile trend. Nevertheless, positive factors are expected to accumulate in the future, driving the upward trend of Hong Kong stocks: 1) Continuous breakthroughs in China's technology industry; 2) Low likelihood of high tariffs; 3) The Fourth Plenary Session of the CPC Central Committee discussing the "14th Five-Year Plan", boosting risk appetite; 4) Continued strengthening of the expectation of interest rate cuts by the Federal Reserve. In the medium to long term, with the start of the Federal Reserve's interest rate cut cycle and the resonant easing policies between China and the US, funds will continue to flow in; improvements in fundamentals, upward revisions in profit expectations combined with a valuation recovery will drive Hong Kong stocks to a slow bull trend. The "four offensive" strategy focuses on resilient types of securities. Mining: Driven by three factors of USD depreciation, low interest rates, and liquidity. Gold is also driven by increasing global geopolitical risks and central bank gold purchases. Copper mining benefits from supply shrinkage and demand growth driven by ShenZhen New Industries Biomedical Engineering's outbreak. Technology stocks: China's AI industry is rapidly advancing, with a high level of prosperity. It has become a new growth engine and is expected to continue to make breakthroughs. Companies like Siasun Robot&Automation and autonomous driving in high-end manufacturing are on the rise. Power: The "digging machine" of the AI revolution. Short-term focus on topics such as controlled nuclear fusion and mirroring of US stocks; mid-term focus on equipment exports; long-term focus on power generation and grid construction. Insurance: Improvement in equity investment returns due to the rise in the stock market, with Hong Kong insurance valuations significantly lower than those of A shares. The "two defensive" strategies are suitable for long-term layouts and risk avoidance. "Turnaround" strategy: Represented by essential consumption, after experiencing four years of difficulties, a turning point in supply and demand is beginning to emerge. Valuations, however, remain at historically low levels in the 20th percentile. Leading companies with competitive advantages can increase market share and profit margins to achieve alpha growth. High dividend strategy: The Hang Seng High Dividend Yield Index has a dividend yield of 6.29%, with stable dividend capability. With the increasing demand for "fixed income+" products driven by the growing Southbound funds, residents moving their savings passively, the demand for dividend stocks continues to be strong.