Guolian An Fund's Zou Xinjin: The first quarter market shows an "A" shape trend, regrouping momentum for a fresh start

Guolianlian Equity Investment Department, General Manager and Director Zhu Xinjin said: In the first quarter of 2026, the market will basically show an “A-shaped” trend. January to February saw spring jitters plus a decline in risk appetite brought by geopolitical conflicts in March. But I still believe that the overall A-share market in 2026 will remain in an upward-trend operating process.

The variables brought by geopolitical conflicts have already been reflected in the market in March. If the scope of the conflict does not expand, the impact on A-shares may be very limited, with only disturbances to certain sectors in the short term and no change to the market’s overall trend.

The cyclical and technology sectors are expected to remain the main theme for the second quarter, but the strength and timing of the stabilization and recovery of overall domestic demand will become the core key variable in determining the height of the market’s upside. With the acceleration of resumption of work and production after the Spring Festival, both production and demand expand in sync, and the PMI index returns to the expansion range. As a large-consumption sector in the post-cycle, constrained by an overall recovery that is somewhat slow and somewhat delayed, it is expected that it will temporarily be difficult to reverse; it may instead show a step-by-step follow-the-trend pattern.

In the convertible bond market, overall valuation is still in a relatively high range, but compared with before the Spring Festival it has already been somewhat alleviated, and the possibility of another sharp decline is expected to be small.

In the short term, the convertible bond market is still constrained by the imbalance between supply and demand. Market moves up or down are more likely led by subscription and redemption behavior of fixed-income plus funds. You may pay attention to opportunities for valuation digestion, such as pullbacks brought about by unexpected events and downward adjustment of conversion prices.

Risk warning: This is only Guolianlian Fund’s market view at the time. The market has risk, and investment is to be undertaken with caution. This material is prepared based on publicly available information that Guolianlian Fund considers reliable. Under no circumstances does the information in this material or the views expressed constitute investment advice to any person, nor is it used as promotional or publicizing material or any legal document. Investors should not treat this view as the sole reference factor for making investment decisions, nor should they believe it can replace their own judgment. Investors bear all risks and consequences arising from any investment actions at their own discretion.

(Editor: Guo Jiandong)

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