Core Viewpoints - The presentation emphasizes the importance of understanding where deposits will be allocated in the future, as this will influence valuations, styles, and financial conditions for the coming year [4][5][6] - The year 2026 is anticipated to be a critical year for awakening the investment value in the Chinese stock market, breaking the stereotype of short-lived bull markets [7][8] Economic and Policy Outlook for 2026 - The nominal GDP growth rate for 2026 is projected to be around 4.5%, slightly higher than the estimated 4% for 2025 [10][11] - Fixed asset investment is expected to remain low, with a neutral forecast around 1%, while consumption is likely to align with nominal GDP growth [11][12] - Export growth is anticipated to be resilient, potentially exceeding nominal GDP growth, with a forecast of around 5% [11][12] Price Trends for 2026 - CPI growth is expected to turn positive, while PPI growth trends are uncertain, with a potential for recovery but no guarantee of turning positive [13][14][15] - The housing market's recovery signals are difficult to identify, but a key indicator is whether mortgage rates fall below rental yields [16][17][18] Structural Changes in the Economy - The middle stream of the economy is expected to show the most significant improvement, with overseas profit margins for middle stream companies surpassing domestic margins for the first time [23][24] - The supply-demand dynamics in the middle stream are changing, with policies targeting this sector leading to adjustments in market conditions [24][25] Financial Conditions and Deposit Allocation - The total amount of deposits will determine valuations and market styles, with M2 growth expected to slow down to around 7.4% to 7.5% [33][34] - The allocation of deposits between residents, enterprises, and non-bank financial institutions will significantly impact economic dynamics and stock market activity [36][38] Investment Insights and Asset Allocation - The focus for 2026 will be on stock investments, with expectations of continued market activity but with a potential slowdown in growth rates compared to 2025 [52][53] - The bond market is expected to face challenges due to increased volatility, with a cautious outlook on interest rates [59] Uncertain Factors - Key uncertainties include the performance of the US stock market, the stability of dollar liquidity, and the potential for infrastructure investments in China to rebound as expected [60]