Top 10 Brokerage Strategies: The downside potential for A-shares is relatively limited; focus on making decisive moves in April! Emphasize certainty in cyclical sectors.

CITIC Securities: Decisions to be Made in April

The trajectory of Iran conflicts and their market impact are highly divergent in expectations. Behind different judgments, three core issues currently cannot be verified, and answers are elusive: First, after the conflict intensity decreases, to what extent can maritime navigation resume? Second, does the Federal Reserve prioritize inflation indicators or focus more on actual employment data? Third, is China facing cost shocks or opportunities from supply chain re-shoring? These questions may only become clearer by April. Faced with significant uncertainty, the market has seen some short-term profit-taking, with previously strong sectors experiencing recent declines.

Overall, most performance-driven and narrative-driven market signals have returned to the same starting line since the beginning of the year. The first three months can be viewed as a market rotation driven by expectations and narrative battles during spring turbulence and cooling, not the definitive winning strategy for the year. The broader rebound in PPI and price transmission, along with corporate profit recovery, remain the key directions with both expectation gaps and room for growth this year. The decision will be made in April.

GF Securities: Seeking Industries That Maintain Independent High Prosperity Beyond Geopolitics and High Oil Prices

Apart from geopolitics and high oil prices, which industries might sustain independent high prosperity? We believe that sectors like optical communications, with deepening overseas AI supply chain visibility by 2027, remain the clear direction of prosperity and are currently the main holdings of institutions. However, their performance is relatively linked to changes in the Middle East conflict (oil prices → US interest rate environment → US AI → domestic supply chain), making short-term volatility difficult to control.

Drawing from the experience of the tech sector, currently, identifying industries that can maintain independent high prosperity in the future is crucial. If their growth trend is relatively decoupled from geopolitics and high oil prices, then regardless of how US-Iran developments unfold next, they should have an advantage in allocation. Therefore, from the perspective of controlling portfolio volatility and hedging, we suggest continuing to allocate to two sectors with upward trends and less oil price sensitivity: energy storage chains (inverters/lithium batteries) and domestic AIDC chains (especially ByteDance-related).

Shenwan Hongyuan: The Current Stage May Be the Most Pressured

The deadlock in US-Iran conflicts continues to weigh on risk appetite, leading to short-term capital withdrawal from the “first-phase rally.” This suggests that the current stage may be the most stressful. Stable growth policies are expected to be implemented, but it’s important to note that the structure of stable growth and absolute returns may differ, posing tail risks. Meanwhile, medium-term uncertainties are underestimated: firstly, for China and the US, monetary tightening to combat imported inflation is likely counterproductive. Increasing inflation tolerance is highly probable. Secondly, the US economy remains resilient, and China has room to maneuver; recession is not the baseline assumption. Additionally, geopolitical deadlock may enhance China’s energy and supply chain security, potentially creating global alpha. Even if US-Iran conflicts persist intermittently, the impact on A-shares is likely to gradually weaken.

In the short term, the market may follow a pattern of “oversold → stable growth policies → rebound.” Subsequent movements are expected to be range-bound, with sector leadership rotating continuously. During phases with new themes (e.g., short-term energy storage, optical communications driven by prosperity), the market may challenge the upper limit of the range; if the rebound stalls, the market could test the lower bound.

In terms of allocation, the focus remains on “practicality,” with CPO and energy storage as strong directions. Under energy cost shocks, new energy and new energy vehicles benefit from diversification and supply resilience trends, potentially becoming key strategic resources alongside traditional energy. Additionally, the “second-phase rally” structure (AI supply chain + pricing cycle) is likely to see pullbacks, which can be opportunistically laid out but with limited short-term timing.

China Galaxy Securities: Limited Downside Space for A-shares

The duration and evolution of geopolitical conflicts remain highly uncertain, and short-term disruptions to global risk assets are unlikely to subside quickly. Global equity markets are expected to continue high volatility. Under the main supporting logic, the downside space for A-shares is relatively limited, and the market is likely to digest external pressures through oscillation and sector rotation. Structurally, the market focuses on inflation logic, with oil price movements under geopolitical conflict still being a key variable influencing recent market structure.

In allocation, attention should be paid to: First, as US-Iran tensions escalate, driving energy and substitute demand, sectors like coal chemicals, coal, shipping ports, oil and gas are worth watching. Second, as the market shifts toward defensive assets, focus on financials, utilities, and transportation. Third, technology innovation sectors, including electrical equipment, new energy, energy storage, semiconductors, computing power, and communication equipment. Additionally, valuation levels in consumer sectors are historically low, with some segments showing potential for recovery, such as agriculture, forestry, animal husbandry, fishery, food and beverages, and household appliances.

CITIC Construction Investment: The Market May Face a Longer Period of Consolidation

Currently, due to the outbreak and escalation of US-Israel conflicts, the assumption of a weak US dollar faces challenges. Under high oil prices, the Federal Reserve’s rate cut expectations have shifted significantly, weakening the core momentum that previously drove this bull market. As we have previously noted, in the latter half of the bull market, the focus will shift from valuation expansion to earnings growth (digesting valuations). If earnings growth expectations remain positive, the bull market in A-shares can continue. However, before growth expectations are confirmed, the market will experience a transitional pain from valuation expansion to earnings realization.

Three strategies to cope with global changes: First, with global energy prices soaring, sectors vulnerable under suppressed consumption include high-valuation stocks, high-energy-consuming industries (oil consumption), and demand-driven cost-inflation sectors. Favorable sectors include those benefiting from the closure of the Strait of Hormuz and sustained high oil prices, such as coal chemicals, new energy, energy storage, nuclear power, and power grids. Defensive stocks with stable cash flow, like coal and hydropower, are also attractive. Additionally, certain growth stocks that may be misjudged, such as AI-related supply chains and power shortage chains, are worth attention.

Guojin Securities: Revaluation of China’s Manufacturing Sector

Amid rising global energy security concerns, China’s unique advantages are increasingly evident. China leads in coal chemical and power equipment industries; its photovoltaic capacity corresponds to an energy efficiency equivalent to 24% of Iran’s Strait oil exports. The completeness of China’s energy system reduces external shocks’ vulnerability and can effectively supply global energy alternatives. Moreover, China’s manufacturing giants are undervalued historically in PE and capacity value metrics—PE ratios are at their highest since 2018, and total market value relative to capacity is also low. Continuous export growth underpins the revaluation basis. Meanwhile, domestic demand shows signs of endogenous recovery: retail sales in January-February stabilized and improved, with strong performance in non-subsidized sectors like tobacco, alcohol, and jewelry, indicating consumption recovery is not solely policy-dependent. Export settlement may be gradually shifting to domestic demand.

The narrative of rising physical assets globally remains valid. Clearing the dollar fog reveals the true picture: First, energy security is crucial amid global turmoil, with a preference for primary energy over secondary energy this year—favoring crude oil, shipping, coal, copper, aluminum, gold, and rubber. Second, China’s manufacturing remains the global ballast, with slow but steady real asset flows awaiting revaluation—especially in power equipment, new energy, machinery, and chemicals. Third, seek structural opportunities in consumption sectors as the negative factors reverse—tourism, scenic spots, fermented flavor products, beer and other alcohols, pharmaceuticals, and medical aesthetics.

Industrial Securities: Earnings Focus Remains “Primarily Our Own,” with a Focus on Prosperity Certainty

Recent market adjustments stem from two main concerns: first, the risk of “stagflation,” and second, the risk of “escalating conflict out of control.” However, neither may be the final outcome of this conflict. In the short term, escalation of conflict may create opportunities for de-escalation, implying that market rebounds often occur when sentiment is most pessimistic. In the medium to long term, “stagflation” might be the most pessimistic scenario for the economy, but it is not the baseline. The current market’s pessimistic expectations about this are largely priced in, providing a foundation for medium- and long-term recovery.

In allocation, from the perspective of benefiting from rising oil prices, the top picks are new energy sectors with both overseas growth and energy substitution logic, as well as coal, agriculture, and gas stocks with cyclical and price-increase potential. For prosperity certainty, focus on North American and domestic computing power chains (CPO, PCB, domestic semiconductor industry), and AI-related downstream sectors with large expectations gaps (gaming, digital media benefiting from AIGC, cloud services driving computing hardware). From a low-positioning perspective, consider previously adjusted biotech and innovative drugs.

Everbright Securities: Consolidation and Waiting for Breakthrough

External factors currently exert some pressure on A-shares. Tensions in the Strait of Hormuz persist, global energy markets are volatile, and inflation expectations have risen. Meanwhile, the Fed’s hawkish stance has increased, putting liquidity under pressure. However, some positive factors remain, such as central bank supportive signals, strong economic data in January-February, and relatively limited impact of Middle East tensions on the domestic economy. Overall, the market is expected to fluctuate sideways.

In the short term, safe-haven assets and commodities may perform due to Middle East tensions. Medium to long term, focus on two main themes: growth and pro-cyclicals. Growth sectors benefit from sustained industry enthusiasm and increased risk appetite in spring, such as humanoid robots and AI. Cyclical sectors benefit from rising commodity prices and policy support, including resource commodities and offline services with potential for continued price increases.

In hotspots, investors can continue to focus on themes like price increases and clean energy. Medium-term, monitor whether crude oil prices stay high for an extended period, which could trigger concerns about “stagflation-like” conditions in the US and increase volatility across asset classes.

Zheshang Securities: Building Up Strength for a Higher Level

Looking ahead, the Shanghai Composite Index may gradually stabilize after mid-March, with some growth indices stabilizing by late April. The “systematic slow bull” remains, and from Q2 to Q3 2026, the index may challenge the 5178–2440 range’s 0.809 quantile. Style rotation favors large and mid-cap stocks, with balanced growth and value.

Industry allocation should focus on “new and old energy,” with four main directions: strong performers in new energy, traditional industries expected for valuation re-rating under HALO trading, internal expansion of cyclical products, and subdivided consumer sectors. Thematic focus includes AI reshaping value foundations, with attention to “HALO” trading and token globalization opportunities.

West China Securities: Waiting for More “Market Stabilization” Policies

The ongoing US-Iran conflict and the shift in expectations for overseas rate cuts continue to suppress the global markets in the short term. Conversely, China’s policy environment is more certain, with regulators signaling “stabilizing the capital market.” Future policies such as “market stabilization funds,” structural tools, long-term funds, and counter-cyclical regulation are worth期待. Meanwhile, imported inflation has limited impact on domestic monetary policy, and loose liquidity will persist, supported by active fiscal measures to restore investor confidence.

In sector allocation, defensive strategies are temporarily favored, focusing on banks, utilities, consumer staples, and energy self-sufficient sectors like new energy and power. High-growth sectors such as AI computing power and energy storage also remain attractive.

(Source: Securities Times)