CITIC Securities Strategy Weekly Reflection: The Market Awaits the Bottom-Fishing Opportunity

Source: CICC Capital Securities

Key Takeaways

The situation in Iran continues to escalate and remains complex and volatile. The market has been repeatedly swayed by signals from the negotiations. Meanwhile, the U.S. and Israel’s military actions are shifting from airstrikes to preparing for ground operations. The next 2–3 weeks are still a high-risk period in which the situation could rapidly deteriorate. The market is waiting for a bargain-buying opportunity, with a strong short-term wait-and-see sentiment toward risk. On the other hand, internal fundamental factors deserve renewed attention. A series of data points collectively support a trend of economic improvement. As March economic data is about to be released and the earnings season approaches, the market’s focus will gradually shift to substantial verification of the strength of economic recovery and improvements in corporate profitability. Along three lines of thought, patiently build positions: the energy security and inflation main theme, certainty-growth assets, policy beneficiaries, and the direction of peak-season prosperity. Industry priorities include: oil and gas production, coal, coal chemical industry, electrical equipment, utilities, chemicals, the AI industry chain, innovative drugs, the infrastructure construction industry chain, service consumption, and more.

A complex and volatile Iran situation; the market is waiting for the right time to buy on the dip

The situation in Iran continues to escalate and remains complex and volatile. The market has been repeatedly swayed by signals from the negotiations. Meanwhile, the U.S. and Israel’s military actions are shifting from airstrikes to preparing for ground operations. In the near term, there are no signs that the overall situation will ease. International crude oil futures prices have been swinging sharply around the 100–110 U.S. dollar range, Brent spot prices have already broken above 140 U.S. dollars, and the VIX index remains at a high level. As of now, the next 2–3 weeks are still a high-risk period in which the situation could rapidly deteriorate. The unpredictability of ground combat has not yet been fully reflected. Investors are still waiting for the full release of geopolitical risk in Iran, and expect to find an entry opportunity once risk is fully repriced.

Key time points to watch next: 1）On April 6, Trump sets the deadline for ultimatums; look for whether any substantive negotiation signals emerge. 2）In mid-to-late April, the troop-withdrawal deadline under the U.S. “War Powers Act”; the economic impact of oil-and-gas shortages on East Asia and Europe will accelerate, and watch the actual control of the Strait of Hormuz and the extent to which navigation is restored. 3）On May 15, the date Trump plans to visit China—also the ceasefire expectation time point predicted by Polymarket.

Internal fundamental factors deserve renewed attention

At the start of 2026, economic data points toward a favorable trend: inflation is gently recovering, March’s PMI is strong, and the “Gold March, Silver April” peak-season effect is showing. Both domestic and external demand improve in tandem. High-tech manufacturing remains buoyant at a high level, and the machinery manufacturing industry and consumer goods sectors show a clear improvement in business conditions. Meanwhile, the operating conditions of industrial enterprises have clearly turned for the better. A series of high-frequency data on capacity utilization and related indicators also supports the broader trend of economic improvement. March economic data will be released in mid-to-early April. In mid-to-late April, A-share annual reports and Q1 reports will enter a period of dense disclosures. The market’s focus will gradually shift to the substantive verification of the quality of economic recovery and improvements in corporate earnings.

Patience in setting up positions along three lines of thought

1）The energy security and inflation main theme: strategic reassessment and transmission through the industrial chain are still ongoing. Focus on oil and gas production, coal and coal chemical industries, new power systems, agricultural pesticides and fertilizers, and more. 2）Certainty-growth assets: rapid declines in market sentiment may lead to indiscriminate sell-offs of some high-quality growth sectors. Focus on the industry cycles within sectors such as AI computing power and innovative drugs. 3）Policy beneficiaries and peak-season prosperity: after the Two Sessions, a series of policy implementation details are expected to be accelerated in issuance and execution. Combined with an upward repair in the economy and the traditional peak-season tailwinds of “Gold March, Silver April,” focus on infrastructure construction starts, service consumption, and more.

Risk Warning: Policies not landing as expected; risks of worsening geopolitical conditions in the Middle East; U.S. stock market volatility exceeding expectations.