Brokerages intensively speak out: the core foundation supporting the medium- and long-term positive trend of A-shares remains unchanged

Special Topic: The Core Foundations of A-Share Remain Unshaken, Staying Committed to Prosperity and Dividends as Dual Mainstays

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By Reporter Zhou Shangyu

Recently, the A-share market has experienced noticeable volatility, with short-term sentiment facing disturbances. In this context, securities firms’ research institutes have been releasing research reports, holding morning briefings for analysis, and leading securities firms have proactively issued “Letters to Investors,” delivering rational voices through high-frequency assessments and analysis.

Overall, the views of securities firms are highly aligned: the current adjustment in the A-share market is essentially a phase of pressure release caused by overseas sentiment spillover and short-term profit-taking, not a trend reversal. The core foundations supporting the medium- and long-term positive outlook of A-shares remain intact.

No Need for Excessive Panic

In response to recent market fluctuations, all securities firms have clearly conveyed the message of “no need for excessive panic,” generally believing that the room for further decline in A-shares is limited, and their resilience over the long term is evident.

“After every adjustment, the market tends to find the most prosperous sectors for bottom-fishing,” said Zhang Xia, Chief Analyst of Strategy Research at China Merchants Securities. He noted that from technical patterns and sentiment indicators, A-shares are already in the latter half of this round of decline, with limited space for further sharp drops. As the market gradually stabilizes and liquidity pressures diminish, structural opportunities will emerge first.

Yang Chao, Chief Strategy Analyst at China Galaxy Securities, also believes that the duration and evolution of geopolitical conflicts remain highly uncertain, making short-term disruptions to global risk assets difficult to resolve. He expects global equity markets to continue exhibiting high volatility. However, supported by the “domestic-led” logic, the downside for A-shares is relatively limited, and the market is likely to digest external pressures through oscillations, differentiation, and sector rotation.

According to Luo Zhiheng, Chief Economist and Director of the Research Institute at Yuekai Securities, China’s stable institutional environment and comprehensive industrial production system form the foundation and confidence for long-term optimism about A-shares. The current market adjustment is more about pressure being released rather than trend reversal. He remains firmly optimistic about A-shares in the long run.

Li Qiusuo, Chief Analyst of Domestic Strategy at CICC Research Department, added that after recent adjustments, risks in the A-share market have been further released, and valuations are at relatively reasonable levels. The current point may represent a mid-term low for A-shares, with deep corrections creating good opportunities for deployment. On a medium-term basis, the macro environment has not fundamentally changed, and the logic supporting a “steady advance” in A-shares still holds. Risk release and downward adjustments are likely to bring favorable allocation opportunities.

Fang Yi, Chief Strategy Analyst at Guotai Haitong Securities, further analyzed that short-term trading shocks will not last long. The current position is not suitable for blindly selling off; China’s stock market is expected to see important bottoms and “buying points.” Stability is the underlying theme, and confidence is key.

Focusing on Structural Opportunities

Based on the clear long-term positive logic for the market, securities firms are precisely targeting structural opportunities aligned with the current environment, offering specific allocation suggestions. The core focus is on resource sectors, technological independence and control, and new energy—areas with long-term growth potential. Some firms have also issued “Letters to Investors” to guide rational views on volatility and to uphold long-term investment principles.

Zhang Xia pointed out that after the adjustment, three main areas should be prioritized: first, resource stocks benefiting from sustained geopolitical premiums and domestic replenishment demand; second, AI infrastructure, including computing power, data centers, and power support, driven by policy and industry trends; third, new energy, supported by the “14th Five-Year Plan” energy transition goals, with long-term policy backing and increasing demand.

Chen Guo, Deputy Director and Chief Strategy Officer at Oriental Wealth Securities Research Institute, suggested a differentiated allocation approach based on “bottom-line thinking”: from a mid-term industry advantage and global energy diversification trend, China’s new energy industry (including wind power, energy storage, photovoltaics, and new energy vehicle chains) is well-positioned to benefit. In the short term, focus on high-confidence sectors like optical modules and energy storage, while also paying attention to low-volatility assets such as dividend-paying stocks and financial sectors.

On March 24, Huatai Securities issued a “Letter to Investors,” rationally analyzing the current market environment: “The moderate recovery of the domestic economy has not reversed, and policies remain positive. External shocks mainly impact short-term sentiment rather than long-term trends. If the core logic of holdings remains unchanged, there’s no need to be overly anxious about short-term fluctuations.” The firm urges investors to view market volatility with a long-term perspective, avoid panic selling, and focus on the long-term value of quality assets during market adjustments.