Galaxy Securities: domestic and foreign liquidity are expected to continue to drive enthusiasm for A-shares

Galaxy Securities research report believes that from a global liquidity perspective, with limited upward momentum in US inflation in August and a weakening labor market, market expectations for a Fed rate cut have further strengthened. The September interest rate meeting will be held next week, and investors expect the Fed to cut rates in September, October, and December. With the Fed rate cut window now open and the US dollar index weakening, the RMB exchange rate is supported, which is favorable for the A-share market. From a domestic perspective, financial data for August shows that non-bank deposits have increased year-on-year, while household deposits have decreased year-on-year. It is still in the early stages of household deposit relocation and may need time for further verification and strengthening. Since July, institutional funds have been flowing in rapidly, with passive funds contributing significantly. The recent implementation of the third phase of public fund fee rate reform emphasizes the development orientation of equity funds. The direction for the entry of equity public funds into the market is clear. Looking ahead, A-shares are likely to continue their upward trend in volatility, but attention should be paid to short-term volatility risks, with changes in market volume being an important indicator of market trends. AI will be the main theme in the market going forward. On one hand, the overseas computing power industry chain will boost the A-share market. The overseas computing power demand remains large, and leading companies will validate the technology narrative. On the other hand, the trend of new quality productivity industries is on the rise, and the importance of autonomous controllable logic is increasing. While the sector market is catalyzed by industrial trends, there may be increased volatility, and attention should be paid to the recovery in specific sub-sectors.