Zhongxin Liang: Chinese stocks have not shown widespread overheating phenomena and it is difficult to reverse the internal competition in the food delivery industry.

On September 10, Li Shihao, China strategist at CITIC Leo, stated that there is currently no widespread overheating in the onshore or offshore Chinese capital markets, with overheating limited to certain sectors. He pointed out that the mainland has not yet reached the level of full public participation in the stock market, and the enthusiasm for A-shares is still at a healthy level. Li Shihao estimated that the recent inflow of funds into the stock market mainly comes from high net worth individual investors. The current rise in Chinese capital stocks is mainly driven by liquidity, and CITIC Leo expects the leading sectors to continue leading the rise until the current uptrend ends. The bank advised investors to pay attention to the future statements from the China Securities Regulatory Commission regarding the capital market, including whether they will mention terms such as "bull market" and "rational investment." Regarding anti-"involution", Li Shihao believes that the authorities will enhance the policies against "involution" and investors can explore related stocks from three aspects: whether there is a slowdown in industry capacity expansion, the possibility of potential policy intervention, and the growth of market share overseas. However, he admitted that it is difficult to reverse the situation of "involution" in the food delivery industry, as it is entirely made up of private companies. Even if the government makes verbal interventions, he believes that price wars will continue due to market forces in play.