Group 1 - The 2026 Capital Markets Conference hosted by CITIC Securities took place in Shenzhen from November 11 to 13, focusing on the theme "Striving for a New Journey" and featuring over a hundred top scholars, industry experts, and representatives from various investment sectors [1] - CITIC Securities' chief economist Mingming projected a GDP growth rate of 4.9% for China in 2025, with stronger growth anticipated in 2026, driven by fiscal expansion and improved local government finances [1] - Domestic consumption growth is expected to reach 3.9% in 2025, with an average growth rate of 4%-5% in 2026, supported by key industries such as automobiles, home appliances, and mobile phones [1] Group 2 - China's manufacturing value-added accounts for 26% of its economy, significantly higher than the 10% in the United States, indicating a relative lag in certain sectors [1] - Infrastructure investment growth is projected at approximately 3% in 2025, with an increase to 4% in 2026, highlighting the importance of policy support for infrastructure development [1] - The economic competition indicators between China and the U.S. are narrowing, with significant disparities in inflation, policy rates, and innovation metrics [2]

Macro Overview - The long-term growth potential of China's economy is significant, with a stable macroeconomic total expected by 2025, but structural differentiation is evident, necessitating policy solutions for weak domestic demand in 2026 [4] - Asset restructuring is crucial, with inflation expectations playing a vital role in wealth management for residents [5] - Global economic and monetary system restructuring is leading to changes in the pricing framework for assets like gold, the US dollar, and US Treasuries [6] Hong Kong Stock Market Strategy - Hong Kong stocks have substantial upward valuation potential, with the overall valuation still considered low despite a rapid recovery in 2025 [11] - The market is expected to attract a significant amount of incremental capital, with over 1.5 trillion yuan anticipated from domestic investors in 2026 [12] - The scarcity of quality assets in the Hong Kong market is a strong supporting factor for upward movement, particularly in sectors like internet, new consumption, and innovative pharmaceuticals [12] - The technology sector is projected to be the main focus for 2026, driven by the AI wave and supportive policies [13] Non-Banking Sector Regulations - The China Securities Regulatory Commission is seeking opinions on new guidelines for performance benchmarks for publicly offered securities investment funds, aiming to address systemic issues in performance comparison and management mechanisms [19][20] - The new regulations will enhance the selection, change, disclosure, and constraint of benchmarks, improving investment transparency and potentially increasing the proportion of index products in the market [21] Asset Overview - Equity markets are outperforming bonds and commodities, with significant gains in Asian markets, particularly Japan and South Korea [25][26] - The bond market shows a "bull steep" characteristic in China, while US Treasuries exhibit a "bear flat" trend due to hawkish signals from the Federal Reserve [27] - Commodity indices have seen declines, with gold and oil leading the downturn, while the US dollar index has risen [28]

Investment Rating - The report maintains a growth forecast for China's real GDP at 4.8% for 2025, aligning with consensus expectations [17][8]. Core Insights - The report highlights that while elevated US tariffs on Chinese goods will negatively impact real GDP growth, the growth of exports to other countries is expected to provide a partial offset, with an anticipated export volume growth of 7.5% in 2025 [7][14]. - The fiscal deficit is projected to widen by 1.9 percentage points of GDP in 2025 compared to 2024, with total social financing stock growth expected to rise to 9.0% [7][52]. - Inflation forecasts indicate a CPI of 0.0% and a PPI of -2.8% in 2025, which are below consensus expectations [7][44]. - The report emphasizes the importance of China's 15th Five-Year Plan, which will focus on security, technology, and boosting domestic consumption to create new growth engines [7][5]. Summary by Sections Macro Views for 2025 - Real GDP growth is forecasted at 4.8%, with domestic demand growth at 3.5% and consumption growth at 4.6% [8][5]. - Exports of goods are expected to grow by 4.9% in nominal USD terms, while imports are projected to decline by 0.6% [8][5]. Inflation and Fiscal Policy - CPI is expected to remain at 0.0%, while PPI is forecasted to decline by 2.8% [8][44]. - The augmented fiscal deficit is projected to be 12.5% of GDP in 2025, reflecting increased government expenditure [52][8]. Structural Economic Changes - The report notes a structural shift towards high-tech product exports, with a revised growth forecast for total goods export volume at 7.5% in 2025 [14][12]. - The anticipated appreciation of the CNY against the USD is also highlighted, indicating a strengthening currency [85][8]. Investment and Consumption Policies - Various easing measures are expected to support consumption and investment, including a consumer goods trade-in program and strategic infrastructure investments [66][7]. - The report outlines that the government will implement policies aimed at enhancing credit support for services and technological innovation [66][7].

Core Viewpoint - The article emphasizes the importance of focusing on "quantity" over "price" in the current economic environment, highlighting that the constraints on price are increasing while the clarity of quantity as a mainline is evident [4][25][26]. Group 1: Asset Perspectives - Equity investment should focus on identifying certainty from "quantity," with a low volatility environment expected to persist, and an upward movement in the market is still pending verification [16][18]. - The bond market is expected to see a defined interest rate range influenced by central bank policies, with a focus on long-term bond positioning [19][20]. - The currency exchange rate is anticipated to seek stability, with the RMB/USD exchange rate expected to remain within a narrow range due to policy interventions [20][21]. - Gold is viewed as a long-term strategic investment, with expectations of price increases driven by global order restructuring [21]. Group 2: Economic Analysis - The article discusses the relationship between exports and employment, indicating that a 1% shock in exports could impact approximately 1.053 million jobs, emphasizing the importance of stabilizing employment in the current economic climate [7][28]. - The analysis of external demand highlights the need for a balanced approach to internal and external economic pressures, with a focus on increasing domestic demand to counteract potential declines in trade surplus [40][41]. - The article outlines potential growth areas for exports, including new energy, metal products, and machinery, with a significant increase in exports to countries involved in the Belt and Road Initiative [12][55]. Group 3: Investment Opportunities - Investment strategies are shifting from construction-focused to equipment acquisition, driven by technological innovation and urban renewal projects, with significant government support for high-end equipment purchases [62]. - The article identifies key sectors for investment growth, including technology innovation, urban infrastructure updates, and industrial backup, with specific emphasis on the demand for advanced equipment in sectors like robotics and data processing [62].

Group 1 - The article emphasizes the reshaping of the global economic landscape and the gathering of various forces in the Chinese market, highlighting the importance of financial technology and digital transformation trends [1][2]. - It invites participation in the LSEG 2025 Market Outlook Forum, which aims to provide insights into market trends and opportunities for the year 2025 [1][2]. - The forum will feature discussions on macroeconomic outlook, capital market connectivity, asset allocation in a low-interest environment, and ETF investment trends [2]. Group 2 - LSEG is identified as a leading global financial market infrastructure provider, serving over 40,000 clients across more than 170 countries with financial data, analysis, news, and index products [3][4]. - The company has a rich history of over three centuries and employs 25,000 professionals from over 60 countries, focusing on promoting financial stability and sustainable growth [4]. - LSEG offers a unique open platform for data and analysis, which is crucial for making confident investment, trading, and risk decisions [6].