Core Viewpoint - The report from Guojin Securities suggests that a bull market driven by the recovery of China's profit fundamentals may be emerging, with two main opportunities to focus on: the potential rebound of Hong Kong stocks and a shift in growth investment from technology-driven sectors to export-oriented sectors [1][4]. Group 1: Economic Context - The "preventive rate cuts" by the Federal Reserve have historically led to a "soft landing" for the U.S. economy, with GDP growth reversing downward trends and a slight decrease in unemployment rates [1]. - The Fed has slightly raised its GDP growth forecast for 2025-2027 while lowering unemployment rate predictions for 2026-2027, indicating a more stable economic outlook [1]. Group 2: Impact on Emerging Markets - The impact of U.S. rate cuts on emerging markets occurs through two main channels: alleviating currency depreciation pressures and providing more room for domestic monetary policy [2]. - If the U.S. achieves a "soft landing," emerging markets, particularly net-exporting countries like China, may benefit from increased external demand driven by U.S. capital expenditures [2]. Group 3: Export Opportunities - Historical data shows that export-oriented A-share companies have outperformed the CSI 300 index during previous rate cut cycles, indicating a potential for similar performance in the current cycle [3]. - Guojin Securities has identified 18 sub-industries that may benefit from the current "preventive rate cuts," categorized into three main types: capital goods related to investment, intermediate goods linked to manufacturing recovery, and consumer and pharmaceutical sectors with their own industry trends [3]. Group 4: Investment Recommendations - The report emphasizes that the bull market may be supported by improved operating conditions due to domestic economic adjustments and recovery in manufacturing activities following rate cuts [4]. - Recommended sectors include upstream resources (copper, aluminum, oil, gold), capital goods (engineering machinery, heavy trucks, lithium batteries, wind power equipment), and raw materials (basic chemicals, fiberglass, paper, steel) [4]. - Additionally, sectors related to domestic demand recovery, such as food and beverage, pork, tourism, and scenic spots, are expected to present opportunities as profit recovery progresses [4].