Market Overview - In January 2026, the equity market showed a good profit effect, with major indices rising, while the bond market stabilized after fluctuations[3] - The performance of cyclical and growth sectors remained strong, with non-ferrous metals, media, and oil and petrochemicals leading gains at 23.02%, 18.85%, and 14.95% respectively[3] - Conversely, the banking, comprehensive finance, and transportation sectors experienced declines of -6.18%, -4.46%, and -0.89% respectively[3] Bond Market Insights - The bond market showed resilience after a period of decline, with major bond fund indices recording gains of 0.24%, 0.20%, and 0.16% for long-term, bond index, and short-term pure bond indices respectively[12] - The performance of first-level, second-level, and convertible bond fund indices increased by 0.85%, 1.65%, and 6.90% respectively, following the strength of the equity market[12] Investment Strategy - The report suggests a balanced allocation strategy in February, focusing on sectors with strong profit elasticity and clear benefits from technological advancements, particularly in "light, electricity, and storage" segments[4] - Traditional dividend stocks are recommended as stabilizing components in investment portfolios, enhancing risk management[4] Risk Considerations - The report emphasizes the need for caution in the bond market, advising against extending duration too much due to the current narrow credit spreads and potential challenges in capital gains[6] - It highlights the importance of monitoring policy signals and maintaining a diversified allocation to mitigate risks in a complex market environment[6] Performance Metrics - The active equity fund selection index has achieved a cumulative net value of 1.5819 since its inception on May 11, 2023, outperforming the CSI 930950 index by 25.37%[23] - The short-term bond fund selection index has a cumulative net value of 1.0481, with an excess return of 0.5456% relative to its benchmark since December 12, 2023[31]

1. Report Industry Investment Rating - No information provided in the report 2. Core Viewpoints of the Report - In January, the global capital market fluctuated violently. Geopolitical tensions, policy changes, and currency market volatility affected asset prices. In China, the market showed a pattern of strong expectations but weak reality. The hot market in January was cooled at the end of the month, and the macro - trading logic may change. Attention should be paid to the adjustment of risk assets due to tightened liquidity expectations [4][6][8]. 3. Summary by Relevant Catalogs 3.1 Global Capital Market Performance - In January, the global capital market was highly volatile. Gold and silver soared and then crashed, and Bitcoin declined. The VIX index rose after violent fluctuations. Global major stock markets all rose, the BDI index increased, the US dollar first declined and then rose, and non - US currencies slightly increased. Commodities generally rose [4][60]. 3.2 Domestic Futures Market Performance - In January, the domestic futures market had high volatility and strong differentiation. The four major stock indexes all rose, with growth stocks outperforming value stocks. Treasury bond futures mostly rose, showing a pattern of near - term weakness and long - term strength. Commodities were active, with precious metals leading the rise, and there was a pattern of strong industrial products, weak agricultural products, and strong external markets, weak domestic markets [5][65]. 3.3 Trump's Nomination of Kevin Warsh - On January 30, 2026, Trump nominated Kevin Warsh as the next Fed Chairman. The "Warsh expectation" may lead to a structural change in the Fed's policy mix, causing asset price re - pricing and increased volatility. It has different impacts on various asset classes such as interest rates, stocks, gold, and cryptocurrencies [14][24][26]. 3.4 "US - Japan Joint Intervention in the Foreign Exchange Market" - The expectation of "US - Japan joint intervention in the foreign exchange market" has changed the macro - logic. The future path depends on whether the joint intervention will be implemented and the solution to Japan's domestic fiscal and monetary policy problems. The sharp appreciation of the yen will have a chain reaction on global asset prices [29][31][35]. 3.5 China's Macroeconomic Data - In 2025, China's GDP grew by 5.0%. In January 2026, the manufacturing PMI dropped significantly, indicating a cooling of manufacturing prosperity, shrinking internal and external demand, and weak production and demand [43][46][100]. 3.6 IMF World Economic Outlook - The IMF predicts that global growth will remain resilient in 2026 and 2027, with a growth rate of 3.3% in 2026 and 3.2% in 2027. Global inflation is expected to decline from 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027 [53][55]. 3.7 Global Economic Performance - The global economic sentiment has cooled overall. Manufacturing PMI has been stable, while service - sector PMI has declined. Major economies' inflation has generally fallen, but inflation expectations show a split trend. Central banks' monetary policies vary, with the Fed shifting from balance - sheet reduction to expansion, the Bank of Japan accelerating balance - sheet reduction, and the People's Bank of China and the European Central Bank expanding their balance sheets [77][85][90]. 3.8 China's Economic Performance - In January 2026, China's manufacturing prosperity declined significantly. M2 growth rebounded slightly, M1 growth continued to decline, and the growth rate gap between M2 and M1 widened. Export growth remained strong, but there were concerns about external demand. The real estate market was weak, consumption growth slowed down, and inflation showed a trend of CPI turning positive and PPI negative growth narrowing [100][103][117]. 3.9 Mid - level Industry Performance - Steel prices were low, and blast furnace operating rates were at a low level. Crude oil prices rebounded, and inventories increased slightly. Copper prices reached new highs and began to accumulate inventories. Coking coal spot prices were stable, but futures prices declined. The Philadelphia Semiconductor Index reached a new high, domestic freight rates showed a split rebound, and automobile production growth was stable [138][142].