Guotai Haitong Securities Co., Ltd. released a research report stating that post-holiday foreign capital and margin funds have returned to the Chinese market after brief outflows before the holiday, while ETF inflows have decelerated. Both domestic and foreign investors are jointly increasing positions in electronics and non-ferrous metals sectors.
Regarding A-share sector allocation, there is a preference for technology and cyclical sectors, with both domestic and foreign capital resonating to increase positions in electronics and non-ferrous metals. Southbound capital inflows have decreased, while foreign capital is marginally flowing into developed markets.
**Market Pricing Status**: Market trading activity remained robust during this period. 1) Market sentiment (rising): Trading activity surged significantly, with average daily trading volume for A-shares rising to 260 million yuan, average daily limit-up stocks increasing to 71.6, maximum consecutive limit-ups reaching 7, sealing rate rising to 70.2%, and stocks appearing on the Dragon-Tiger List increasing to 66. 2) Profit-making effect (rising): The proportion of rising individual stocks increased to 54.1%, with the median weekly return of A-share stocks rising to 0.4%. 3) Trading concentration (rising): Industry trading concentration continued to improve, with 11 industries having turnover rates at historical percentiles above 90%, among which the automotive sector maintained the top position for four consecutive periods.
**A-Share Capital Flows**: Post-holiday foreign and margin funds returned to the market, while ETF capital inflows slowed. 1) Public funds: New issuance scale of equity-oriented funds declined to 870 million yuan, with various public funds reducing stock positions compared to the previous period. 2) Private funds: Private fund confidence index slightly decreased in October, with positions continuing to approach annual highs (as of 09/19). 3) Foreign capital: Inflow of $300 million (as of 10/08), with northbound capital trading proportion historical percentile rising to 30.5%. 4) Industrial capital: IPO fundraising totaled 190 million yuan, additional issuance scale was 2.11 billion yuan (as of 10/05), and restricted stock unlocking scale reached 79.12 billion yuan. 5) ETF: Passive capital inflows accelerated, with net inflows totaling 37.7 billion yuan over the past four trading days. Post-National Day passive trading proportion was 6.7%, maintaining relatively high levels, and stock ETF premium/discount rates also increased. 6) Margin trading: Net purchases of 50.81 billion yuan during this period, with trading volume proportion rising to 12.9%. 7) Retail investors: Alternative indicators show marginal decrease in retail investor activity during this period.
**A-Share Sector Allocation**: Preference for technology and cyclical sectors, with domestic and foreign capital jointly increasing positions in electronics and non-ferrous metals. 1) Foreign capital: (as of 10/08) Electronics (+3.47 billion yuan) and non-ferrous metals (+2.04 billion yuan) led net inflows, while home appliances (-460 million yuan) and banking (-310 million yuan) experienced net outflows. 2) Margin trading: (as of 10/09) Electronics (+10.85 billion yuan) and non-ferrous metals (+6.58 billion yuan) led net inflows, while comprehensive sector (-20 million yuan) experienced net outflows. 3) ETF: Primary sector passive capital flows were concentrated, with non-bank financials (+3.74 billion yuan) and power equipment (+2.89 billion yuan) leading net inflows. Among secondary sectors, securities and batteries led net inflows, while telecommunications (-700 million yuan) and computers (-280 million yuan) led net outflows, with telecom equipment and consumer electronics leading outflows in secondary sectors.
Top ETFs with increased holdings during this period included securities ETF and battery ETF, while Hong Kong innovative drugs and securities company ETFs led margin net purchases. CSI A500 ETF and telecom ETF led net redemptions, while Hang Seng Tech and 30-year treasury bond ETFs led margin net sales. Additionally, in the two trading days before the holiday, ETFs mainly increased holdings in electronics, new energy, and computers while reducing positions in non-bank financials. 4) Dragon-Tiger List funds: Non-ferrous metals, mechanical equipment, and environmental protection were the top three sectors on the Dragon-Tiger List.
**Hong Kong Stocks and Global Capital Flows**: Southbound capital inflows decreased, with foreign capital marginally flowing into developed markets. The Hang Seng Index fell 1.0% during this period, with most global major markets declining and the Brazilian stock index (+2.5%) leading gains.
From a capital perspective: 1) Southbound capital weekly net purchases decreased to 2.65 billion yuan, at the 78th percentile since 2022 (MA5). Foreign capital inflows into the Hong Kong stock market totaled $500 million during this period (as of 10/08). 2) Developed markets saw active/passive capital net flows of -$3.03 billion/$21.63 billion during this period (as of 10/08), while emerging markets saw active/passive capital net flows of -$530 million/$1.69 billion. From a foreign capital perspective only, global foreign capital continued to marginally flow into developed markets during this period, though inflow scale decreased significantly, with the United States (+$3.46 billion) and China (+$700 million) leading inflows. From a global overall flow perspective including domestic capital from various countries, the United States and China led inflows while Japan and the United Kingdom experienced outflows. North American funds received net subscriptions, with U.S. healthcare and financial sector funds leading net subscriptions while technology sectors experienced outflows.
**Risk Warning**: Potential deviations in data statistical scope; data calculation errors; risks of data deviations obtained from third-party institutions.