Institutions: The foundation of this round of A-share market remains solid.

Cixin Securities believes that during the holidays, there was no obvious escalation in the situation between the US and Iran. Major global equities markets saw a modest rebound, and stock markets in the US, Japan, South Korea, and others all closed higher to varying degrees. On Tuesday, the A-share market surged higher at the start of trading, but overall risk appetite remained somewhat weak. Long positions had relatively limited upside momentum, causing trading volume to continue to shrink, and the index level also shifted into a sideways consolidation pattern. On the trading board, the chemical sector performed better, boosted by rising prices of pesticide technicals and improved profitability for products such as glyphosate. The PCB sector also strengthened following price increases for related products, while the consumer and precious metals sectors lagged. Looking ahead, compared with markets such as Japan, South Korea, and the US, the A-share market is more resilient. As long as the Shanghai Composite Index does not break the previous low, it should still be viewed as a sideways rebound trend. However, before the fighting is fully over, global risk appetite is more likely to fall than rise. At the same time, a potential energy crisis caused by the events and the performance risks brought by A-share earnings season will suppress the timing of incremental capital entering the market. There may be some back-and-forth during the large-cap rebound. Therefore, in the short term, market trading activity may remain subdued, and the index level may stay range-bound. Before the large market shows clear signs of improvement, capital market styles may be even more practical. Looking at the medium term, the market will most likely be dominated by broad-range sideways consolidation, and volatility could increase. It is advisable to manage positions reasonably and wait for market-driven turning point signals to emerge. The foundation of the current A-share rally remains solid. We expect that the Middle East conflict will only affect the A-share market’s short-term sentiment and trading rhythm, and will not change the market’s direction. We remain confident in the trend toward long-term improvement for the market, so investors should not be overly concerned.

Dongwu Securities believes that on Tuesday, the Shanghai Composite Index dipped to a low early in the session before rebounding, then fluctuated and fell later, with narrow trading ranges in the afternoon. The Shenzhen Component Index and the ChiNext Index rose early and then pulled back; after midday they dipped to lows and then rebounded, but near the end of the day they fell somewhat again. On the trading board, sports, chemicals, agriculture, and shipping led the gains, while construction machinery, steel, and insurance made small adjustments. The Shanghai Composite Index hovered with mild fluctuations around the 3,900-point level. From the perspective of several major indexes, it still appears to be consolidation after a big surge over the past year. However, many individual stocks have already fallen below the low point in April last year. This divergence may become the norm in the future: capital will concentrate in certain companies that benefit from some policy and earnings expectations, while weak sectors will gradually be marginalized.