The fund's spring strategy conference is being held intensively, with public fund professionals actively discussing new market opportunities.

Author: Wei Zhaoyu

Recently, multiple public fund institutions such as Fortune Fund, Everbright Prudence Fund, and Changxin Fund held spring strategy meetings. Several fund managers analyzed the equity market from various angles, including macroeconomic changes and trends in popular sectors.

Public fund institutions generally believe that the overall economy is expected to remain stable and that we are currently in a critical stage of transitioning from old to new growth drivers. This year marks the beginning of the 14th Five-Year Plan, a period typically characterized by intensive industrial policy releases, which will bring abundant structural opportunities to the market. Considering multiple factors, public fund institutions remain optimistic about the overall A-share equity market this year.

Corporate Earnings Will Be the Key Variable

In 2026, the monetary policy directions of China and the US will continue to be a market focus. Regarding this, Xu Wangwei, Director of Equity Investment at Changxin Fund, stated that after the Federal Reserve began cutting interest rates, the external environment for China’s capital markets presents both opportunities and challenges, but the overall impact is positive. Even if the Fed’s rate cuts fluctuate, China’s monetary policy space has been opened, and there is ample room for expansion in fiscal and industrial policies. In the face of external disturbances, domestic policy tools and endogenous recovery momentum are sufficient to support market stability. “Therefore, regardless of overseas market volatility or disruptions, based on fundamentals and policies, we should maintain strong confidence in China’s capital market and overall asset performance.”

Cui Shutian, Director of Stock Research at Everbright Prudence Fund, expressed optimism about the A-share market in 2026, stating that corporate profitability will determine the direction and structure of stocks. Over the past two years, the A-share market experienced a typical valuation repair rally, but historically, such periods rarely last three years. With limited room for further valuation expansion in 2026, corporate earnings will become the core variable influencing market trends. From historical experience, during periods of earnings digestion and valuation adjustment, market styles tend to shift. This year, the A-share market is expected to transition from a single focus on technology growth to a “new and old” dance involving technology, manufacturing, and cyclical sectors.

Fang Lei, Director of Equity Investment at Everbright Prudence Fund, warned that the biggest current systemic risk is the global stagflation expectation. If this occurs, it will significantly impact asset pricing, prompting market funds to shift toward inflation-resistant assets. The most noteworthy assets in this environment are upstream resource commodities, which directly benefit from rising commodity prices and can effectively hedge inflation pressures, making them key defensive assets during stagflation.

Focus on Price Increase Trading Logic

Regarding allocation this year, Zhang Shengxian, Fund Manager at Fortune Fund, stated that rising prices have once again become a core theme in the A-share market, driving strength in cyclical resource sectors. The current macro environment domestically and abroad is also conducive to “price increase trading.” As energy prices push up the price level, economic data such as PPI may turn positive faster than market expectations. Historically, during periods of rising PPI, sectors like chemicals, steel, building materials, transportation, oil and petrochemicals, and non-ferrous metals tend to outperform. As cyclicals’ valuations recover, market styles may shift from a focus on AI alone to a “dual drive” of “AI + price increases” and “technology + cyclicals.”

Additionally, Zhang Yun, FOF Fund Manager at Everbright Prudence Fund, emphasized the importance of the return of excess returns from value styles. “Since October last year, we’ve observed a slowdown in the decline of US bond yields, entering a volatile range, which has weakened the excess returns of growth styles in A-shares, while value styles have gained excess returns. The market situation since last October reflects this trend—value styles have occasionally risen and are no longer under continuous pressure as before.”

AI and New Energy Sectors Are Worth Expecting

Regarding technology sectors, Cui Shutian noted that AI is the core theme of the tech sector. The trend will shift from infrastructure construction led by overseas giants to application deployment and supply-demand bottlenecks in the industry chain. In early 2026, the tokens used for AI large models will see a significant increase compared to 2025, with applications expanding across office, finance, customer service, and other fields. Corporate willingness to pay will rise, and revenue scales for model vendors will grow substantially. Investment opportunities will spread from traditional segments like optical modules and PCBs to bottleneck areas such as power shortages, storage, and electronic components. For example, the surge in electricity demand for AI data centers in the US will create investment opportunities in gas turbines and diesel generators; AI demand will also drive prices of related products like upstream storage, PCB components, and passive elements.

Besides AI, consumer electronics also show many highlights. Lu Xiaofeng, Fund Manager at Changxin Fund, believes 2026 could be a significant year for electronic products that are either cyclical or traditional. “Since the end of last year, we’ve seen price increases in storage, PCBs, LEDs, and passive components. There are three common factors behind this: first, supply-side factors, such as slow expansion in storage, with limited supply growth; second, demand-side factors, with AI boosting various sub-industries and bringing additional demand and orders; third, rising raw material costs, as commodities like gold and copper, which are major costs for many passive and electronic components, have increased. This year, many passive components and traditional electronic cyclical products, including storage, may enter a boom cycle.”

Recently, the investment value of the new energy sector has attracted widespread attention. Wang Yao, Senior Analyst at Changjiang Securities, stated at the spring strategy meeting of Changxin Fund that the fundamentals and investment landscape of new energy have undergone significant changes, mainly due to improvements in supply-demand dynamics. On the supply side, policies related to “anti-involution” are continuously introduced, accelerating supply-side clearing. On the demand side, the rise of AI and the broader tech sector has driven electricity consumption, with data centers expanding rapidly and energy demand exploding. Meanwhile, government policies also support demand. The combined efforts on both supply and demand sides are the core reasons for the current turning point and fundamental change in the new energy market.

(Edited by: Xu Nannan)

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