Bank stocks are weakening, and institutions are viewing the future market in this way.

Banking stocks weakened today, with Shanghai Bank, Bank of Communications, and Shanghai Pudong Development Bank leading the decline. Orient Securities pointed out that the current period is seeing the intensive implementation of stable growth policies, with loose monetary policy leading the way followed closely by loose fiscal policy, significant acceleration of localized debt issuance, which will have a profound impact on the fundamental outlook of banks this year; Fiscal policy is intensifying to support social financing and credit while boosting economic expectations, and pro-cyclical varieties are expected to benefit; A broad range of interest rate reductions is putting short-term pressure on net interest margins of banks, but high-interest deposits are entering a period of concentrated repricing overlaid with continuous regulatory crackdown on high-interest deposit-taking behavior, providing important protection for bank interest margins this year; This year is a year of solidifying bank asset quality, with policy support expected to significantly improve the risk outlook for real estate and infrastructure assets, and parts of personal loan varieties with sufficient risk exposure and disposal are expected to reach an inflection point in asset quality. Zhejiang Securities pointed out that when considering banking from a strategic perspective, under the pressure of trade wars, it is still a combination of low risk and low risk-free interest rates. Decreasing risk appetite and rising macro volatility mean that low-volatility banks have the advantage; Falling risk-free interest rates drive the favoritism towards high dividend-yielding banks; With stable risk assessment, it is preferred to allocate banks in economically developed regions. Based on this, the stock selection strategy comprehensively considers low volatility, high dividend yield, and regional asset distribution.