Guangfa Securities: Market sentiment rebounds, suggest actively focusing on the insurance sector.

Guangfa Securities research report indicates that recently, due to changes in geopolitical events and the market's reduced expectations of external impacts, the market has gradually rebounded. After the insurance sector's valuation significantly retreated due to a shift in market sentiment towards pessimism, there is a certain amount of upside potential. Looking at the fundamentals of the insurance sector, in the short term, the growth rate of liabilities is expected to continue, the trend of residents shifting deposits remains unchanged, the advantages of floating returns for dividend insurance are highlighted, individual insurance and bancassurance are expected to continue to improve, the integration of banking and insurance and the reduction of scheduled interest rates are conducive to the improvement of value rates, and the liability side is expected to continue good growth in 2026. In the medium to long term, with stable long-term interest rates and the drive of the equity market, the asset side of insurance companies is expected to improve, the reduction of new order scheduled interest rates will drive the inflection point of existing liabilities' costs, the integration of banking and insurance will optimize distribution costs, and the marginal improvement of the long-term interest margin of insurance companies is expected.