Public Fund Spring Strategy Conference Sends Confidence: China's Assets Demonstrate Resilience and Highlight Multiple Investment Opportunities

◎Reporter Zhao Mingchao

Recently, several fund companies including Fidelity Fund, HSBC Jintrust Fund, and Changxin Fund have held their spring strategy meetings. Multiple fund managers publicly stated that the overall valuation of equity assets is at a historical low. With the recovery of listed companies’ profitability, future investment opportunities will present a diverse landscape, making it a good time for allocation.

Due to the impact of geopolitical conflicts in the Middle East, the global market has recently experienced significant adjustments. Min Liangchao, the Director of Equity Research at HSBC Jintrust Fund, stated that against this backdrop, RMB assets have shown strong resilience. On one hand, compared to other global economies, China’s supply chain advantages are significant, with diverse sources for crude oil imports, and a coal chemical industry chain as an alternative, making it relatively less affected by supply chain and demand shocks; on the other hand, RMB assets are relatively undervalued compared to other global assets. When global liquidity easing expectations are corrected leading to valuation adjustments, the impact on RMB assets, as undervalued assets, is relatively more controllable.

“Currently, the overall profitability of A-shares and Hong Kong stocks is at a historically relatively low level. Although it may be affected by rising oil prices, there is no obvious downward risk. Moreover, the supply chain advantage makes domestic demand less impacted, and future profitability improvement is worth looking forward to. After experiencing adjustments, we are optimistic about the subsequent investment opportunities in A-shares and Hong Kong stocks, and we will focus on both profitability improvement and relative undervaluation,” said Min Liangchao.

In the view of Zhang Shengxian, a fund manager at Fidelity Fund, the profitability growth rate of A-shares is expected to rebound significantly by 2026, and both ROE and asset turnover are expected to rise, with the sustainability of profitability improvement likely to be better than in 2025. Currently, foreign investment in Chinese stocks is still significantly underweight. From a global perspective, the proportion of Chinese assets in global emerging markets is continuously increasing, but there is a clear “underweight” phenomenon among foreign investments. With the expectation of RMB appreciation strengthening and A-share valuations being relatively low globally, the attractiveness of the Chinese stock market is prominent.

Xu Wangwei, Director of Equity Investment at Changxin Fund, believes that the current liquidity is reasonably ample, investors’ risk appetite is relatively stable, and the market’s operational rhythm is expected to continue a mild upward trend. “We are currently in a new wave of technological revolution centered around artificial intelligence. From a long-term perspective, whether it is the accelerated evolution of the AI industry in the United States or the continuous breakthroughs in China’s hard technology sector, both are deterministic trends.”

Where to find future investment opportunities? Multiple fund managers unanimously believe that the market style will be more balanced, with many investment opportunities to seize.

“We are optimistic about the performance of the A-share market in 2026, as corporate profitability will determine the direction and structure of the stock market,” said Cui Shutian, Director of Equity Research at Everbright Prudential Fund. He noted that the past two years have seen A-shares as a typical valuation extraction market, but historically there has never been a situation where valuation was extracted for three consecutive years. The valuation expansion space in 2026 is limited, and corporate profitability will become the core variable determining market direction. From historical experience, during the stage of profitability digesting valuation, market styles are prone to switch. This year, the A-share market is expected to shift from a single technology growth focus to a pattern where technology, manufacturing, and cyclical sectors dance together.

Zhang Shengxian’s views are also relatively similar. He stated that since the beginning of the year, price increases have become the core clue for A-shares, driving cyclical resource products to strengthen. As energy prices push up inflation, the timing for domestic PPI to turn positive may exceed market expectations. Based on historical experience, during the upward phase of PPI prices, cyclical industries such as chemicals, steel, building materials, transportation, oil and petrochemicals, and non-ferrous metals tend to perform well. As the valuation of cyclical sectors recovers, the market style may shift from the singular prominence of AI to a dual-driven model of AI + price increases and technology + cycles.

Regarding the technology sector, which has garnered significant market attention, Cui Shutian believes that AI is the core main line of the technology sector, with the market rhythm gradually shifting from being led by overseas giants and infrastructure construction to application landing and supply-demand bottlenecks in the industrial chain.

“The artificial intelligence sector is expected to perform exceptionally well overall in 2025. From the performance data of related listed companies, some leading enterprises have achieved significant growth compared to 2024, which also confirms that the core driving force of hard technology lies in the sustained improvement of industry prosperity and concentrated performance breakthroughs,” reminded Gao Yuan, Director of Research and Development at Changxin Fund. He noted that as the development pace differences of various sub-sectors in hard technology become apparent, the internal differentiation within the sector may further intensify. Despite being optimistic about the overall AI sector, it is essential to focus on high-quality targets with greater performance certainty and faster growth.

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Editor: Yang Ci