Core Viewpoint - The recent policy changes by the Ministry of Finance aim to strengthen the long-term assessment of state-owned commercial insurance companies, guiding insurance funds towards stable long-term investments, which will enhance the long-term investment returns of insurance companies and alleviate investment pressures [1][4]. Group 1: Policy Changes - On July 11, the Ministry of Finance issued a notice to guide insurance funds towards long-term stable investments and to strengthen the long-term assessment of state-owned commercial insurance companies [2]. - The assessment method for "return on net assets" and "capital preservation and appreciation rate" has been adjusted to combine annual indicators with 3-year and 5-year cycle indicators [3]. - The weights for the annual indicator, 3-year cycle indicator, and 5-year cycle indicator are set at 30%, 50%, and 20% respectively [3]. Group 2: Market Impact - The policy is expected to enhance the long-term investment capabilities of insurance companies, allowing them to better tolerate short-term fluctuations in investment returns, thereby promoting a focus on long-term stable investments [4][5]. - The allocation of equity assets by insurance funds is anticipated to increase, although the overall asset allocation style will remain stable [5]. - As of Q1 2025, the balance of funds utilized by insurance companies was 34.93 trillion yuan, with stock investments accounting for 8.43% and 7.56% of life and property insurance companies respectively [5]. Group 3: Investment Recommendations - The insurance sector is seen as having significant long-term allocation value due to its low valuation and stable dividend levels, despite uncertainties in investment performance for 2025 [6]. - If the equity market remains volatile, it is recommended to focus on China Pacific Insurance (601601.SH); if the market trends positively, attention should be directed towards New China Life Insurance (601336.SH) and China Life Insurance (601628.SH) [6].

Investment Rating - The industry rating is "Recommended" [4] Core Insights - The non-bank financial sector index increased by 3.96%, outperforming the CSI 300 index by 3.14 percentage points, ranking third among all primary industries [2][15] - The implementation of the "28 Measures for High-Quality Development of the Securities Industry" aims to enhance self-regulation and promote high-quality development within the securities sector [3][16] - The recent notification from the Ministry of Finance emphasizes the importance of long-term stable investments by state-owned insurance companies, adjusting performance evaluation metrics to include longer time frames [7][17] Market and Sector Performance - The average daily trading volume of A-shares reached 14,961 million yuan, a week-on-week increase of 3.8% and a year-on-year increase of 138.2% [20] - In the second quarter of 2025, the average daily trading volume was 12,886 million yuan, up 55.7% from the same period in 2024 [20] - As of July 10, 2025, the margin trading balance was 18,737.06 billion yuan, a 0.78% increase from the previous period and a 19.57% increase compared to the average level in 2024 [20] Regulatory Developments - The "Implementation Opinions" released by the China Securities Association outlines 28 measures to strengthen self-regulation and enhance the service capabilities of securities firms [3][16] - The new performance evaluation system for state-owned insurance companies will now consider annual, three-year, and five-year indicators for net asset return and capital preservation rates, with respective weights of 30%, 50%, and 20% [7][17][19] Investment Opportunities - The adjustment in performance evaluation metrics for insurance companies is expected to reduce sensitivity to short-term market fluctuations and enhance the willingness of insurance funds to enter the market, potentially stabilizing market operations [8][19] - The securities sector is anticipated to achieve high-quality development as the new measures are gradually implemented, fostering a more robust industry ecosystem [6][16]

Core Viewpoint - The Ministry of Finance emphasizes the importance of guiding insurance funds towards long-term stable investments, enhancing the role of state-owned commercial insurance companies as a stabilizing force in the economy [1] Group 1: Investment Strategy - State-owned commercial insurance companies are encouraged to focus on prudent operations, long-term investments, value investments, and stable investments [1] - The notification calls for the improvement of internal long-term assessment mechanisms and investment portfolio management [1] Group 2: Investment Management - Companies should identify high-quality investment targets that offer stable cash flow returns, are risk-controlled, and have appreciation potential [1] - There is a strong emphasis on enhancing investment management capabilities and adhering to internal investment management systems [1] Group 3: Risk Management - The notification highlights the need for improved investment decision-making processes and risk assessment systems [1] - Companies are urged to conduct thorough due diligence, yield analysis, and risk evaluations for investment projects [1]