The author of this article is Wei Fengchun, Chief Economist of Chuangjin Hexin Fund. As the new year begins, everything is renewed. Our pre-New Year Chief Perspective indicated that post-holiday analysis would focus more on the 'methods and tools.' This implies a shift from the 'philosophical discussions' of the past month and a half towards 'practical action,' suggesting that further waiting would be unproductive. Through previous Chief Perspective articles, we have conducted a detailed analysis of the framework, logic, and targets for asset allocation in 2026, but this only addresses the issues of trend and structure; the question of timing still requires a flexible, opportunistic approach. Furthermore, all strategies are predictions and need to be refined and adjusted based on market changes. This means even staunch value investors must consider market fluctuations. Moreover, as asset management enters the era of industrialization and intelligence, investor demands are shifting from simply leveraging single assets and chasing returns towards balancing risk and return within a diversified asset system. Our Chief Perspective believes that the short term currently outweighs the long term, essentially integrating judgment logic that combines trend, structure, and rhythm.

The plan for the year lies in spring, and historical trends show that investment layouts at the beginning of the year have a significant directional impact for the entire year. For instance, in the first 2025 Chief Perspective, we argued for 'stepping out of the comfort zone,' indicating a shift in allocation thinking from low-risk asset comfort zones towards embracing opportunities from industrial transformation. However, this correlation is not absolute. Since 2020, early-year asset trends have shown a moderate positive correlation with full-year allocation direction, but this must be dynamically assessed alongside constraints such as black swan events, policy shifts, and liquidity reversals. Data indicates that the directional signals from rate bonds and large-cap value stocks are relatively reliable, whereas growth stocks and commodities are more susceptible to external shocks and can lose their predictive power. Generally, early-year signals should be used as a starting point, with data verification and risk checks conducted through March and April to build a 'signal + verification + correction' full-year judgment framework, avoiding over-reliance on any single signal.

First, the A-share market's twelve consecutive gaining sessions highlight clear structural themes. The revaluation process for Chinese assets continued after the New Year. Data shows that as of January 5, 2026, on a weekly basis, the top-performing major assets were the Hang Seng Tech Index, the STAR 50 Index, copper, and aluminum, while silver and gold posted negative returns. On the first trading day after the holiday, market characteristics were very pronounced: A-shares exhibited a structural market favoring growth stocks with value stocks diverging. The Shanghai Composite Index stabilized above the 4000-point mark, with the STAR Market and ChiNext indices leading the gains, showing a significant capital siphoning effect. News of mass production for brain-computer interfaces served as a strong catalyst, triggering a surge of limit-up gains in related sectors. Semiconductors and healthcare strengthened simultaneously, benefiting from industrial policy support and expectations of technological breakthroughs. In contrast, heavyweight sectors like petroleum & petrochemicals and banks adjusted under pressure from capital outflows. Overall, the market style is tilting towards AI + hard tech, while low-valuation defensive sectors are under phased pressure, making the structural themes quite clear. Investors should pay close attention to the phenomenon of the Shanghai Composite Index's twelve consecutive gaining sessions. Such a streak is historically rare in the A-share market; achieving this record on January 5, 2026, marked the first occurrence since 1993. Historically, after streaks of nine or more gaining sessions, the probability of a short-term correction exceeds 70%. This current streak carries risks in three aspects: first, concentrated profit-taking could trigger a correction; second, intensified sector divergence means most individual stocks are underperforming the major indices, with high risks of a pullback in elevated thematic stocks; third, external volatility and policy expectations falling short could trigger capital outflows, necessitating vigilance towards price-volume divergence and the risk of inflated index gains.

Second, macroeconomic indicators are sending mixed signals. Macro data is typically scarce at the start of the year, and market trends are often guided by narratives around practices and statements, making the limited data particularly valuable. 1. PMI Data The Manufacturing Purchasing Managers' Index (PMI) for December 2025 reached 50.1%, returning to expansion territory for the first time since April 2025. The primary reasons for this exceeding expectations are threefold. First, policy measures are taking effect, with new policy financial tools and special bonds supplementing funds for infrastructure and manufacturing, and the Central Economic Work Conference reinforcing counter-cyclical adjustment, thereby boosting corporate expectations. Second, there is a resonance of domestic and external demand, with the new orders index rising to 50.8%, and external demand improving as trade conditions ease, pushing the new export orders index to 49.0%. Third, the staggered Lunar New Year holiday and front-loaded production led companies to rush orders and stockpile goods, with the PMI for high-tech manufacturing reaching 52.5%, indicating structural optimization supporting the uptick in business sentiment. This signal is crucial for macroeconomic stabilization: firstly, it verifies smooth policy transmission, forming a positive feedback loop of 'policy -> expectations -> investment -> demand'; secondly, the expansion of production and demand breaks deflationary expectations, stabilizing employment and household income expectations; thirdly, the simultaneous improvement in manufacturing and non-manufacturing sentiment lays the foundation for a 'stable start' to 2026. Despite the optimism, investors should remain cautious as the PMI for small and medium-sized enterprises remains in contraction territory, requiring continued policy support to consolidate the recovery momentum. 2. Understanding and Action Regarding Real Estate Positioning The Construction Industry Business Activity Index (PMI) for December 2025 rebounded significantly by 3.2 percentage points to 52.8%, with simultaneous expansion in building construction and civil engineering activities, confirming the effectiveness of efforts on the investment front. A commentator article in the January 2026 issue of *Qiushi* magazine clarified the misconception about real estate's 'declining importance,' explicitly affirming its financial asset attributes and its role as a pillar of the national economy. This marks a shift in market cognition from a framework focused on 'risk disposal' towards a dialectical framework emphasizing 'stabilizing expectations and promoting transformation.' The market expects policy to likely continue its orientation of 'providing sufficient measures at once,'协同发力 involving the removal of restrictive measures on the demand side and协同发力 on the supply side through destocking and constructing new models. This shift is critical for resolving balance sheet recession: by stabilizing property valuations to repair the asset side for households and enterprises, it alleviates precautionary saving tendencies while enhancing policy credibility. The government has consistently used counter-cyclical adjustment to counter recessionary expectations, with everything from policy financial tools to debt optimization serving the purpose of balance sheet repair. This implies the feasibility of a dual-engine approach involving both the stock market and real estate in the future: the stock market boosts consumption through the wealth effect and aids industrial upgrading, while real estate stabilizes expectations to solidify the economic foundation, forming a positive feedback loop of 'asset repair -> demand recovery -> expectation strengthening.' 3. Downward Shift in Global Crude Oil Price Benchmarks For global manufacturing, a lower crude oil price benchmark can directly reduce energy and raw material costs, creating conditions for profit recovery—a transmission path with relatively strong certainty. This further provides evidence for our previously proposed thesis of 'capital flowing towards mid-stream industries.' Of course, we need to be wary of short-term disturbances from geopolitical risk premiums and the time lag in capacity recovery, which may constrain the extent of oil price declines. 4. Renminbi Appreciation The appreciation of the Renminbi against the US dollar is a prerequisite for the revaluation of Chinese assets, and this logic remains unchanged for now. 5. Divergence Between the Citi Economic Surprise Index and the Shanghai Composite Index A divergence trend between the Citi Economic Surprise Index and the Shanghai Composite Index has been evident since August 2025. In fact, the A-share market has been largely consolidating during this period, indicating that fundamental factors still exert a gravitational pull on the stock market. At the critical juncture of the Shanghai Index's twelve consecutive gains and touching previous highs, the influence of these fundamentals on the market's rhythm cannot be ignored.

Third, Industrial Trends. The market in 2025 provided us with two clear insights: first, industry is the cornerstone of asset allocation, and second, narrative-driven trading can amplify the efficiency of industrial allocation. In 2026, our Chief Perspective will make more attempts at the industrial level, seeking to unearth more structural opportunities. Starting from industry and anchoring analysis on entrepreneurs is the logical starting point of the theory of creative destruction and represents the essence of the Austrian School. 1. The AI Revolution Behind Silver Export Controls Starting in 2026, China's silver export controls shifted towards refined management,核心 involving the abolition of the quota system and the implementation of a triple constraint system: 'case-by-case approval + export license + state-trading qualification.' Only qualified enterprises are permitted to conduct business, with each order requiring verification of the importer's qualifications and the final use of the silver,本质 representing precise control rather than a comprehensive ban. The underlying industrial logic is clear: silver has prominent industrial properties and is a key raw material for strategic industries like photovoltaics, new energy vehicles, and semiconductors. Domestic demand from these related industries is expanding rapidly, continuously widening the supply-demand gap. China holds a dominant position in the global silver refining segment. The export controls aim to prioritize the security of the domestic strategic industry supply chain, forcing resources to concentrate in higher value-added processing stages, while simultaneously securing initiative in the global competition for critical minerals. This approach is consistent with the管控思路 for strategic resources like rare earths, balancing industrial security and international competition. 2. Industrial Trends in Sino-South Korean Cooperation The visit of South Korean President Lee Jae-myung to China included accompanying business leaders covering semiconductors, new energy, automotive, and other fields. The market expects Sino-South Korean cooperation to focus on collaboration in semiconductor memory and automotive chips, stabilizing the materials supply chain; in the new energy sector, promoting increased investment by automakers and full-chain collaboration in power batteries; in AI, combining South Korean technology with Chinese application scenarios to deepen practical use;同时拓展 cooperation in emerging areas like green transformation and biomedicine, leveraging complementary advantages to stabilize supply chains and expand markets. 3. Revolutionary Events in Brain-Computer Interfaces and Autonomous Driving Breakthroughs in brain-computer interface and autonomous driving technologies in 2026 signify AI's move from the laboratory to large-scale commercial application, which will redefine the 'AI+' investment theme. Tesla's Full Self-Driving (FSD) system achieved a zero-intervention cross-country drive in the US, validating the maturity of autonomous driving technology through end-to-end neural networks. Brain-computer interfaces have commenced mass production and automated surgical procedures, breaking through bottlenecks for deployment in medical and consumer scenarios. The underlying logic is the deep integration of AI technology with physical scenarios, forming a positive feedback loop of 'algorithm iteration -> cost reduction -> scenario expansion.' Investment opportunities focus on three chains: first, core hardware, covering components like sensors and specialized chips that support technology implementation; second, scenario applications, where areas like autonomous driving and medical rehabilitation are率先兑现 demand; third, ecological synergy, involving new tracks催生 by cross-border technological integration. This trend confirms that AI industrialization is entering an acceleration phase, becoming a core driver of economic transformation and asset value appreciation.

MACD golden cross signals have formed, and these stocks are performing well!