Guojin Securities: It is recommended to seek early layout in the next stage of the sector with the greatest improvement in fundamentals.

Guo Jin Securities pointed out that at the market's 10-year high, it is recommended to seek early layout in areas where there is the greatest improvement in basic fundamentals in the next stage. First, with the recovery of overseas manufacturing, physical assets will benefit, as well as capital goods under accelerated investment. In the medium to long term, attention should be paid to the opportunities brought by industrial chain restructuring, which will enhance both investment and consumer physical consumption at both ends. Second, the long-term asset side of insurance will benefit from the bottoming out of capital returns, followed by securities firms. Third, after profit recovery, opportunities will also emerge in domestic demand-related areas. The Shanghai and Shenzhen 300 index, representing large cap blue chips, has not yet outperformed the ChiNext Index, but has begun to outperform the China Securities 2000 index in the recent style switch. The market diffusion has just begun, the recovery of A-share heavyweight stocks has just begun, with a focus on food and beverage, power equipment. Furthermore, due to the impact of the reversal of expectations for a rate cut by the Federal Reserve, overnight HIBOR surged significantly, putting pressure on the Hong Kong stock market. As the rate cut in September is already a foregone conclusion, considering that the relative outperformance of Hong Kong stocks compared to A-shares this year has been significantly reversed, the A-H market will return to a unified starting line. Changes in corporate profits will become the driving force behind the performance differences between the two markets.