Core Points - The Fourth Plenary Session of the 20th Central Committee of the Communist Party of China was held from October 20 to 23, 2025, in Beijing, with 168 Central Committee members and 147 alternate members in attendance [1] - General Secretary Xi Jinping delivered an important speech, emphasizing the need for high-quality development and the implementation of the 15th Five-Year Plan [2][5] - The session highlighted significant achievements during the 14th Five-Year period, noting the resilience of the economy and the progress towards modernization [3][4] Economic Development - The 15th Five-Year period is deemed crucial for solidifying the foundation for socialist modernization, with a focus on high-quality development and addressing complex domestic and international challenges [4][6] - The session outlined principles for economic development, including the importance of the Party's leadership, prioritizing people, and ensuring high-quality growth [6][7] - Major goals for the 15th Five-Year period include significant improvements in high-quality development, technological self-reliance, and enhanced social welfare [6][8] Innovation and Market Development - Emphasis was placed on accelerating technological self-reliance and innovation, integrating education, technology, and talent development [7][8] - The session called for the construction of a strong domestic market and the promotion of a new development pattern, focusing on expanding domestic demand and enhancing supply [7][8] Social and Cultural Development - The session stressed the importance of cultural innovation and the promotion of socialist culture, aiming to enhance the influence of Chinese civilization [9] - It highlighted the need for improving people's livelihoods and promoting common prosperity, addressing urgent social issues and enhancing public services [9][10] Environmental and Security Measures - The session underscored the necessity of a green transformation in economic and social development, aiming for ecological safety and sustainable growth [10] - It emphasized the modernization of the national security system and the importance of maintaining social stability and safety [10][13] Party Leadership and Governance - The session reiterated the importance of the Party's self-revolution and strict governance to ensure effective leadership in economic and social development [11][12] - It called for unity among the Party and the people to achieve the goals set for the 15th Five-Year Plan, emphasizing the need for comprehensive governance and stability [11][12]

Group 1 - The upcoming 20th Central Committee's Fourth Plenary Session will focus on the "14th Five-Year Plan" and its implications for the "15th Five-Year Plan" [1] - The session is scheduled to take place from October 20 to 23 in Beijing, where the draft proposal for the 15th Five-Year Plan will be reviewed [1] - The 15th Five-Year Plan is expected to build on the achievements of the 14th Five-Year Plan, with a focus on the 100th anniversary of the military in 2027 and supporting the modernization of national defense and the military by 2035 [1] Group 2 - The military industry ETF (512660) tracks the CSI Military Industry Index (399967), which selects listed companies in sectors such as aviation, aerospace, shipbuilding, weaponry, and military electronics [1] - The index aims to reflect the overall performance of publicly traded companies in China's military industry, with a focus on small and mid-cap stocks primarily in the aviation equipment and military electronics sectors [1]

Group 1 - The defense and military industry experienced a significant pullback, ranking among the top declines in the Shenwan primary industry, with active trading in related ETFs [1] - The Aerospace ETF (159227) saw a decline of 1.66% with a transaction volume of 125 million yuan, maintaining its position as the leader in its category [1] - Recent capital flows indicate a strong interest in the military sector, with the Aerospace ETF (159227) attracting over 295 million yuan in net inflows over the past month, reaching a new high of 633 million yuan [1] Group 2 - The "14th Five-Year Plan" is entering its final year, with the military industry facing fewer disruptive factors and downstream demand showing signs of recovery [2] - The long-term goals for the military industry provide clear guidance for development, aiming for modernization by 2035 and establishing a world-class military by 2050 [2] - The defense and military sector is expected to see significant improvements with recovering demand and optimized capacity structure, indicating a high safety margin and long-term growth certainty [2]

Core Insights - The military industry is experiencing a recovery in demand, with significant government budget increases and strategic plans for modernization [2][3] Group 1: Market Performance - On July 11, major indices rose collectively, with the Shenzhen Component Index increasing by 0.61% and the ChiNext Index by 0.80% [1] - The aerospace sector rebounded after a short-term adjustment, with the Guozheng Aerospace Index rising by 0.88% [1] - The Aerospace ETF (159227) saw a 0.64% increase, closing at 1.100 yuan, with a trading volume of 85.76 million yuan and a total scale of 563 million yuan, leading its category [1] Group 2: Government Initiatives - French President Macron announced military budget increases of 3.5 billion euros in 2026 and 3 billion euros in 2027, totaling 64 billion euros, which is double the amount from 2017, focusing on defense modernization and equipment upgrades [2] - The Ministry of Industry and Information Technology released work points for the integration of information technology and industrialization for 2025, emphasizing digital transformation in manufacturing and support for low-altitude economic development [2] Group 3: Institutional Perspectives - Northeast Securities noted that with the "14th Five-Year Plan" entering its final year, disturbances in the military industry have largely dissipated, and downstream demand is recovering [3] - The long-term goals for military modernization by 2035 and the establishment of a world-class military by 2050 provide clear guidance for industry development [3] - The defense and military sector is expected to see significant improvements with recovering demand and optimized capacity structure, indicating high safety margins and long-term growth certainty [3] Group 4: Related Products - The Aerospace ETF (159227) closely tracks the Guozheng Aerospace Index, focusing on core military aerospace sectors, with a high concentration of 98.2% in the first-tier military industry [4] - The index has a significant weight of 66.5% in aerospace equipment, surpassing other military indices, making it an efficient tool for investing in leading "fighter jet stocks" [4]

Group 1 - The defense and military industry sector has seen a net inflow of over 12 billion yuan, indicating strong investor interest [1] - Key stocks in the sector, such as Zhongji Xuchuang, have experienced significant net buying, with a net inflow of 923 million yuan [1] - The Defense ETF (512670.SH) has risen by 4.09%, with major components like AVIC Shenfei and AVIC Chengfei showing substantial gains [1] Group 2 - Northeast Securities highlights the long-term growth certainty of the defense and military sector, with demand recovering and structural optimization underway [3] - The military industry has faced challenges in 2023, but disruptions are now largely resolved, leading to a recovery in downstream demand [3] - The sector is guided by clear long-term goals, including achieving modernization by 2035 and building a world-class military by 2050 [3] Group 3 - Related products include the Defense ETF (512670) [4] - Key associated stocks include AVIC Shenfei, AVIC Optoelectronics, and Aero Engine Corporation of China among others [4]