Sinolink: Northbound capital flows back, margin trading activity reaches nearly three-week high

Sinolink released a research report stating that the activity of northbound funds has rebounded, and based on calculations, the overall net buying of A shares by northbound funds has resumed. Structurally, northbound funds may mainly buy computer, food and beverage, and non-ferrous metal sectors, while selling machinery and other sectors. The margin trading activity has continued to slightly increase to nearly a three-week high. In terms of industries, margin trading mainly net bought electrical equipment, communications, machinery, etc., while net selling food and beverage, petroleum and petrochemical, coal, etc. The consensus on buying between ETF and northbound funds continues to decline, while the consensus on buying between margin trading and the top ten shareholders' trading has increased. This indicates that various participants are mostly returning to the market to some extent, but the overall divergence is increasing, and attention will be paid to whether the consensus on buying in the market can gradually increase. Sinolink's main points are as follows: Trading activity & volatility: Market trading activity has rebounded, except for the Shenzhen 100 Index, the volatility of other main indices has increased. In terms of industries, the trading activity of sectors such as communications, electronics, electrical equipment, chemical industry, machinery, and real estate are above the 80th percentile, and the volatility of communications and electronics is above the 80th percentile historically. Earnings forecast: The net profit forecast for 2025 and 2026 for all A-shares has been revised down/up respectively. In terms of industries, the net profit forecast for 2025 and 2026 for sectors such as non-bank, non-ferrous metals, power and utilities, communications, etc. has been raised. The activity of northbound funds has rebounded, and based on the calculations of the bank, the overall net buying of A shares by northbound funds has resumed. Structurally, northbound funds may mainly buy computer, food and beverage, and non-ferrous metal sectors, while selling machinery and other sectors. The margin trading activity has continued to slightly increase to nearly a three-week high. In terms of industries, margin trading mainly net bought electrical equipment, communications, machinery, etc., while net selling food and beverage, petroleum and petrochemical, coal, etc. The trading activity of the top ten shareholders has continued to decline, the proportion of trading volume in sectors such as real estate, agriculture, forestry, animal husbandry, fisheries, steel, etc. is relatively high and still rising. The positions of actively managed equity funds have increased, excluding the factors of price fluctuations, actively managed equity funds have mainly increased their positions in communications, non-ferrous metals, electrical equipment, etc., while reducing their positions in media, consumer services, and computer sectors. ETFs have been net purchased, mainly by institutional investors. In terms of ETFs tracking indices, ETFs related to the SSE 300, CSI A500, and K50 indexes have been mainly net purchased, while ETFs related to the ChiNext Index and dividend indexes have been net redeemed. In terms of ETFs split by industry, ETFs mainly net bought electronics, non-bank, pharmaceuticals, etc., and mainly net sold electrical equipment, chemical industry, and banks. High-frequency tracking of participant consensus: The consensus on buying between ETFs and northbound funds continues to decline, while the consensus on buying between margin trading and the top ten shareholders' trading has increased. This means that various participants are mostly returning to the market to some extent, but the overall divergence is increasing, and attention will be paid to whether the consensus on buying in the market can gradually increase. Risk Warning Calculation error: Numerical models are based on historical data, and there may be errors in the fitting process, in addition, the statistical sample itself may also cause errors in the calculation results.