CITIC Securities' Qiu Xiang: Stabilizing and increasing profit margins are necessary prerequisites for continuing the bull market, shifting focus from valuation to profit margins.

Jiu Xiang, Chief A-share strategist of CITIC Securities, pointed out in his speech at the CITIC Securities 2026 Spring Capital Market Forum that geopolitical turmoil coincides with the index reaching a key threshold, spring is a period of confidence rebuilding and index resolution. A-shares in spring are at a key juncture, and the long-term stabilization and recovery of corporate profit margins is the necessary prerequisite for the continuation of the bull market in A-shares. In the next stage, the focus of attention will shift from valuation to profitability, with low valuation and pricing power being the two most important factors. Low valuation is the strongest shield, undervaluation is superior to overvaluation, value is superior to growth, and large caps are superior to small caps, which is the core strategic principle for dealing with rising global costs and weakening financial conditions. In terms of allocation, firmly focus on the layout of Chinese advantageous manufacturing and pricing power.