How will the A-shares perform after the holiday? Brokerage firms analyze: The outlook is not pessimistic; stay tuned for the attack signal.

During holidays, it’s a good time to revisit and reorganize your investment logic.

According to the latest strategy views from several securities research institutes, although investors’ wait-and-see sentiment is currently strong, there are no pessimistic signals in terms of liquidity, and the trend of residents’ funds entering the market remains unchanged. Before the “shoe drops” on geopolitical conflicts, the market is expected to continue its sideways trend; patiently waiting for the call for a counterattack might be the more prudent strategy right now.

The willingness to add to positions has not weakened

In March this year, the conflict between the U.S. and Iran, triggered by the Middle East, stirred global capital markets, and A-shares saw the largest adjustment since the so-called “reciprocal tariffs” in 2025. But despite increased volatility in index performance and a continued shrinking in trading volume, Zhang Qiyao, Chief Strategist at Industrial Securities, emphasized that he had not observed negative feedback in A-shares’ liquidity. Some absolute-return funds may have trimmed positions slightly in the early stage, but after the adjustment, the willingness to add positions was stronger.

He pointed out that since the current round of market gains, the entry of funds into the market has shown a convergence pattern across various types of capital—namely, risk-capital funds, ETFs, private funds, margin financing and securities lending, and fixed-income “plus” strategies. With the diversification of incremental capital layered on top of expectations that the national team will step in to support the market, liquidity resilience is stronger—which is also one of the key reasons A-shares have performed relatively better than other global markets since March.

Among these, fixed-income “plus,” pension funds, and insurance funds all fall under pan-absolute-return target capital, with the equity core at around 15%. With greater market volatility in the earlier period and the pressure of turning yields negative within the year, some funds may have trimmed positions slightly to protect returns. However, newly deployed operational funds for insurance and pensions have continued to grow rapidly, and their configuration needs in equity assets remain strong; adding positions and building positions on dips may be a more preferred choice.

Chen Gang, Chief Strategy Analyst at Soochow Securities, also noted that currently, various micro-level funds have not shown any clear outflows. On one hand, financing funds have not fled materially despite heightened risk. As of April 3, the financing balance was 2.58 trillion yuan, down only 25.8k yuan compared with the high point at the beginning of March, and the financing guarantee ratio is still clearly higher than the level in the first half of 2025. On the other hand, although the total net value of stock-type ETFs has been reduced significantly, the main driver is the decline in market capitalization. As of April 3, total ETF units were 2.1 trillion, down only 76.08B units compared with the high point at the beginning of March.

He believes that what is happening now is that investors are taking a more wait-and-see stance, which leads to a contraction in trading volume. If risks ease somewhat, residents may accelerate their entry into the market. As of April 3, A-shares’ trading volume was 1.67 trillion yuan, not lower than the low point in December 2025, and also significantly higher than the level in the first half of 2025. Meanwhile, the number of new brokerage accounts in March was 4.6 million, second only to October 2024 and January 2026. Residents’ enthusiasm for entering the market is high, and it has not been dampened by market adjustments driven by geopolitical risk.

Expect the sideways trend to continue; suggested to wait

“Stay firm and wait for the counterattack.” Liao Jingchi, Chief Strategist at Zheshang Securities, said that considering the complexity of Middle East geopolitical turmoil and the conflict’s substantive “spiral escalation,” global capital markets are still expected to face pressure, and A-shares may continue to show a state of sideways consolidation. In the short term, the Shanghai Composite Index is expected to operate in a “range-bound sideways pattern, a second attempt to find the bottom, support along the lower bound, and pressure along the upper bound” manner. The “right foot” of the second bottoming may gradually take shape in late April, and there is hope that it can form a weekly-scale rebound.

Based on the judgment of “geopolitical escalation causing global volatility, and A-shares conducting a second attempt to find the bottom through consolidation,” he suggests that in terms of positioning, investors should remain cautious in the short run and treat the broader market as range-bound. When the index approaches the “upper bound” of the new volatility range, you should give up greed and appropriately “sell at relatively high prices.” When the index moves to the “lower bound” of the new volatility range, overcome fear and “buy modestly on dips.” If the situation in the Middle East becomes clearer after mid-April, and the medium-term bottom structure in A-shares is formed, investors may then actively increase allocations and expand upside flexibility.

The latest allocation recommendations provided by the Financial Engineering Research Team at China Merchants Securities also say the same thing: “wait.” Overall, before geopolitical risks have been fully cleared, the probability that the market will maintain a sideways market is higher. In addition, considering the impact of high oil prices on global economic growth, A-shares’ earnings may face pressure. However, domestic economic data in China is not bad at present; leading indicators such as credit have shown a warming trend. And after valuation declines, the market will again release room for valuations to rise. Therefore, A-shares have relatively strong resilience.

On the style front, whether the future is played out with a more optimistic scenario, or a more cautious scenario of “mid-term demand declining and the CPI-PPI scissors gap being passively narrowed,” based on historical statistics, in the near term it is not recommended to over-allocate aggressive products such as growth styles. It is suggested that value styles—with stronger defensive attributes—remain the main allocation to reduce volatility. It is not too late to pivot to aggressive positioning after risks have been further cleared.

（Source: China Securities Journal）