Galaxy Securities: A-share market trading volume is still on the way

Galaxy Securities pointed out that the A-share market is entering an upward trend, with investors' risk appetite significantly increasing and driving the market's profitability spreading. A significant increase in turnover is a typical sign. The important contribution of market funds is increasing, and the trend of incremental growth is still sustainable. Margin balance continues to grow, reaching above 2.1 trillion yuan, but the indicators of margin balance as a percentage of A-share market value and margin trading volume as a percentage of A-share turnover are at historical median levels, far below the peak in 2015. Under the dual effect of asset shortage and stock market profitability, signals of households moving their savings are emerging. At the same time, policy expectations remain a key variable in the medium-term market trend. The meeting of the Central Political Bureau in July has clearly stated that the 20th Fourth Plenum will be held within the year to discuss and formulate the "Fifteenth Five-Year Plan." The market will gradually lay out around the new round of policies, combined with deepening capital market reforms and continued industry policies, in order to further enhance risk appetite and investment confidence. Looking overseas, at the Jackson Hole Global Central Bank Annual Meeting, Powell sent out a signal of easing, hinting at the possibility of a rate cut in September and leading to a rebound in equity assets. Under the long-term weakening cycle of the US dollar index, the reshaping of global capital flows is providing further support for the A-share market to move upwards.