Huaxi Securities: A-share slow bull trend remains unchanged, focus on high earnings growth or improved economic conditions.

Huaxi Securities research report pointed out that the slow bull trend of A shares remains unchanged. In late January, the disclosure period for annual performance forecasts is intensifying, and attention is focused on directions with high performance growth or improved economic conditions. Firstly, from the perspective of macro policies, as 2026 marks the beginning of the 15th Five-Year Plan, many departments have issued a series of supporting industry policies and investment plans. This week, the central bank launched a targeted support policy for key areas under the monetary and financial policy "combination punch", and emphasized that "there is still room for reserve requirement ratio cuts and interest rate cuts this year". The anticipated strong start to the economy will continue to support risk appetite. Secondly, there is still room for incremental funds such as insurance funds, long-term funds, resident funds entering the market, and foreign funds flowing back due to the appreciation of the exchange rate. Thirdly, in terms of fundamentals and industrial cycles, as the decline in PPI narrows, it is expected that corporate profits will enter a mild recovery channel in 2026. The game for profit inflection points will become an important support for the market. In late January, companies will intensively disclose their 2025 annual performance forecasts. Investors can focus on opportunities in the direction of high growth or profit reversal in annual performance forecasts. In terms of industry configurations, one can focus on the following: 1. The diffusion of the technology industry market: such as AI computing power, AI applications, robotics, Hong Kong-listed Internet companies, etc. 2. Benefiting from the "anti-inner spiral" and price increase direction, such as the chemical industry, non-ferrous metals, etc. 3. Directions with high growth in annual performance forecasts: such as electronics, machinery equipment, pharmaceuticals, etc.