Core Viewpoint - The recent surge in the A-share market has seen the Shanghai Composite Index reach a peak of 3704.77 points, approaching the ten-year high of 3731.69 points set on February 18, 2021, marking a significant milestone for the market and investors [1] Historical Context - The Shanghai Composite Index has only surpassed its ten-year high twice in the past 35 years, first on February 17, 2000, and then on December 14, 2006 [2][4] - The first instance in 2000 led to a significant sell-off, with a 3.1% drop on the same day, followed by a period of volatility before a sustained upward trend lasting nearly 1.5 years, culminating in a peak of 2245.42 points on June 14, 2001, representing a 27.86% increase from the previous high [4][6] - The second instance in 2006 resulted in a strong upward trend, with the index reaching 6124.04 points by October 16, 2007, a maximum increase of 172.73% from the previous high [6] Trading Volume Trends - Prior to both instances of reaching a ten-year high, the daily trading volume of the Shanghai Composite Index had already set historical records, indicating strong market interest [6][8] Market Behavior Pre and Post New Highs - In the three months leading up to the ten-year high in December 2006, the market exhibited structural behavior, with the top ten performing industry indices averaging a 62.25% increase, while the bottom ten indices averaged a decline of 0.54% [8][9] - After the ten-year high was reached, the market shifted to a broad-based rally, with the Shanghai Composite Index increasing by 30.71% and most industry indices outperforming the index itself [9][10] Correlation Analysis - A negative correlation of -0.35 was observed between the performance of industry indices in the three months before and after the ten-year high, suggesting that industries that performed well prior may lag in the subsequent period [9] - Notably, the securities industry showed strong performance both before and after the new high, with increases of 73.44% and 86.15%, respectively [9] Extended Analysis - The trends observed in the three-month periods before and after the ten-year high also held true for the six-month periods, although the correlation between industry performance before and after diminished to 0.01, indicating a shift in market dynamics [11]

Report Summary 1. Report Industry Investment Rating - Not provided in the given content 2. Core Viewpoints of the Report - The strategy is based on the research reports "Strategy Portfolio Report under Industry Rotation: Quantitative Analysis from the Perspective of Industry Style Continuity and Switching" (20241007) and "Research on the Overview and Allocation Methods of the Stock - type ETF Market: Taking the ETF Portfolio Based on the Industry Rotation Strategy as an Example" (20241013) to construct a strategy portfolio of industry and theme ETFs [2] - In the week of 20250811, the model recommends allocating sectors such as joint - stock banks, games, and semiconductors. In the next week, the strategy will newly hold products like Game ETF, Science and Technology Innovation Chip Design ETF, and Satellite ETF, and continue to hold products like Bank ETF, Financial Real Estate ETF, and Gold Stock ETF [2] - As of last weekend, some ETFs and the trading timing signals of the underlying indexes gave daily or weekly risk warnings [2] 3. Summary by Relevant Catalogs Performance Tracking - During the period from 20250804 to 20250808, the cumulative net return of the strategy was about 2.62%, and the excess return relative to the CSI 300 ETF was about 1.41% [3] - From October 14, 2024, to the present, the cumulative out - of - sample return of the strategy was about 7.08%, and the cumulative excess relative to the CSI 300 ETF was about - 0.79% [3] Future 1 - Week Recommended ETFs (20250811 - 20250815) | Fund Code | ETF Name | Holding Status | ETF Market Value (billion yuan) | Heavy - Positioned Shenwan II Industry and Weight | Weekly Timing Signal | Daily Timing Signal | | --- | --- | --- | --- | --- | --- | --- | | 512800 | Bank ETF | Continue to hold | 151.38 | Joint - stock banks (44.73%) | 1 | - 1 | | 159869 | Game ETF | Transfer in | 73.17 | Games (81.29%) | 1 | 1 | | 588780 | Science and Technology Innovation Chip Design ETF | Transfer in | 2.77 | Semiconductors (95.73%) | 1 | 1 | | 159940 | Financial Real Estate ETF | Continue to hold | 7.99 | Securities (29.12%) | 1 | - 1 | | 517520 | Gold Stock ETF | Continue to hold | 46.34 | Precious metals (41.51%) | 1 | 1 | | 510000 | Central Enterprise ETF | Continue to hold | 1.21 | State - owned large - scale banks (18.11%) | 1 | 1 | | 512690 | Wine ETF | Continue to hold | 152.39 | Baijiu (85.37%) | - 1 | - 1 | | 159206 | ZETF | Transfer in | 1.33 | Military electronics II (34.22%) | 1 | 1 | | 159786 | VRETF | Transfer in | 1.32 | Optoelectronics (26.64%) | 1 | 1 | | 159652 | Non - ferrous 50 ETF | Transfer in | 5.21 | Industrial metals (49.34%) | 1 | 1 | [9] Near 1 - Week ETF Holdings and Performance (20250804 - 20250808) | Fund Code | Current Holding Status | ETF Name | ETF Market Value (billion yuan) | Near 1 - Week Increase/Decrease (%) | | --- | --- | --- | --- | --- | | 562550 | - | Green Power ETF | 1.21 | 1.50 | | 512800 | Continue to hold | Bank ETF | 151.38 | 1.99 | | 512690 | Continue to hold | Wine ETF | 152.39 | 1.06 | | 159768 | - | Real Estate ETF | 6.13 | 2.14 | | 159940 | Continue to hold | Financial Real Estate ETF | 7.99 | 1.41 | | 515220 | Transfer out | Coal ETF | 80.20 | 3.78 | | 159996 | Transfer out | Home Appliance ETF | 12.72 | 2.55 | | 510060 | Continue to hold | Central Enterprise ETF | 1.21 | 1.42 | | 516550 | Transfer out | Agricultural ETF | 1.87 | 1.76 | | 517520 | Continue to hold | Gold Stock ETF | 46.34 | 8.91 | | - | ETF Portfolio Average Return | - | - | 2.62 | | 510300 | - | CSI 300 ETF | 3819.72 | 1.21 | | - | ETF Portfolio Excess Return | - | - | 1.41 | [10]

Group 1 - The core viewpoint of the article highlights that northbound capital has increased its holdings in A-shares for two consecutive quarters, with a total market value of 2.29 trillion yuan by the end of Q2, reflecting a 2.4% increase from the previous quarter and a 3.9% increase from the end of last year [1] - The top five industries with the highest northbound capital holdings are batteries, semiconductors, liquor, joint-stock banks, and white goods [1] - In July, there were multiple trading days where significant investments were made in the semiconductor and new energy vehicle sectors, indicating a focus on technology growth sectors [1] Group 2 - The increase in northbound capital is attributed to rising expectations of interest rate cuts by the Federal Reserve, which may lead global capital to seek better investment opportunities in emerging markets like A-shares and Hong Kong stocks [1]

Group 1: Target Price Increases - The companies with the highest target price increases on August 6 include Jiuzhou Pharmaceutical, BYD, and Phoenix Media, with target price increases of 57.75%, 51.41%, and 36.49% respectively, belonging to the healthcare, automotive, and publishing industries [1][2] - Jiuzhou Pharmaceutical received a target price of 29.12 yuan, while BYD's target price is set at 158.00 yuan, and Phoenix Media's target price is 15.00 yuan [2] Group 2: Broker Recommendations - A total of 27 listed companies received broker recommendations on August 6, with Zhongchong Co. receiving the most recommendations at 6, followed by Haiguang Information with 4, and Jiuzhou Pharmaceutical with 2 [1][3] - Zhongchong Co. closed at 57.44 yuan, while Haiguang Information closed at 137.34 yuan, and Jiuzhou Pharmaceutical closed at 18.46 yuan [3] Group 3: First Coverage Ratings - On August 6, brokers provided 7 instances of first coverage, with Changhong Huayi receiving a "Buy" rating from Shanxi Securities, and Haitong Development receiving a "Buy" rating from Jiangsu Securities [4] - Other companies receiving first coverage include Pudong Development Bank, Huaxin Cement, and Hisense Home Appliances, all receiving "Buy" or "Recommended" ratings from various brokers [4]

Strategy Overview - The report focuses on constructing a strategy portfolio based on industry and thematic ETFs, utilizing quantitative analysis from previous strategy reports [2]. Strategy Update - For the week of August 4, 2025, the model recommends increasing allocations to sectors such as electricity, joint-stock banks, and liquor, while continuing to hold real estate and agriculture ETFs [2]. - New additions include Green Power ETF, Bank ETF, and Liquor ETF, with ongoing holdings in Real Estate ETF and Agriculture ETF [2]. - As of the last weekend, some ETFs and index trading timing signals provided daily or weekly risk alerts [2]. Performance Tracking - From July 28 to August 1, 2025, the strategy recorded a cumulative net return of approximately -2.19%, with an excess return of about -0.53% compared to the CSI 300 ETF [2]. - Since October 14, 2024, the cumulative return of the strategy outside the sample period is approximately 4.34%, with an excess return of about -2.17% relative to the CSI 300 ETF [2].

Core Insights - Northbound capital has increased its holdings in A-shares for two consecutive quarters, indicating foreign investors' confidence in the Chinese market's future [1][2] Northbound Capital Data - As of the end of Q2, northbound capital's market value reached 2.29 trillion yuan, up 532 billion yuan (2.4%) from Q1 and 855 billion yuan (3.9%) from the end of last year [2] - The number of shares held by northbound capital increased to 1.235 billion shares, a rise of 38 million shares (3.2%) from Q1 and 3 million shares (0.2%) from the end of last year [2] - The top five industries by northbound capital holdings are batteries, semiconductors, liquor, joint-stock banks, and white goods, with a notable focus on technology and banking sectors [2] Top Holdings - The top ten stocks held by northbound capital include CATL, Kweichow Moutai, Midea Group, China Merchants Bank, and others, with CATL holding 128.7 billion yuan, a 3.2% increase from Q1 [3] Economic Outlook - The GDP for Q2 was reported at 34,177.8 billion yuan, reflecting a 5.2% year-on-year growth, which has led several foreign institutions to revise their economic forecasts for China upwards [6][7] - UBS highlighted that the Chinese technology sector is becoming increasingly attractive due to local innovation and the application of AI, supported by improving fundamentals [3][7] Investment Environment - Recent improvements in indices and regulations are creating a favorable environment for foreign capital entry, with the A500 index emphasizing ESG and connectivity [5] - New regulatory measures for northbound investors will take effect from January 12, 2026, enhancing the reporting and oversight of foreign investments [5] Sector Expansion - Chinese electric vehicle manufacturers are expanding into overseas markets, particularly Europe, where competition is less intense, potentially increasing profit margins [8]

Core Viewpoint - Foreign capital has continuously increased its holdings in A-shares for two consecutive quarters, indicating a positive sentiment towards the Chinese stock market [2][3]. Group 1: Foreign Capital Holdings - As of the end of Q2 2023, northbound funds held a total of 2,907 stocks, with a total shareholding of 123.2 billion shares and a market value of approximately 2.29 trillion yuan [3]. - Compared to the end of 2024, the market value of northbound funds increased by 87.1 billion yuan, and compared to Q1 2025, it increased by over 50 billion yuan [3]. - The top five industries by market value held by northbound funds are battery, semiconductor, liquor, joint-stock banks, and white household appliances, with market values of 175.4 billion yuan, 134.9 billion yuan, 134.1 billion yuan, 123.4 billion yuan, and 103.6 billion yuan respectively [3]. Group 2: Structural Adjustments in Holdings - In Q1, the main sectors for increased holdings were technology and consumer sectors, while in Q2, technology continued to attract investment, and consumer stock holdings decreased [4]. - The behavior of northbound funds in Q2 can be described as shifting from "core assets to old economy" and "from old tracks to new tracks," with increased investments in sectors like non-ferrous metals, transportation, public utilities, non-bank financials, and construction decoration [4]. - Notably, northbound funds significantly increased their holdings in banks and gold stocks, with market values rising by 21.3 billion yuan and 12.3 billion yuan respectively compared to the end of 2024 [4]. Group 3: Key Stocks and Market Outlook - Among the ten major stocks held by northbound funds, the top positions are occupied by Ningde Times, Kweichow Moutai, Midea Group, and China Merchants Bank, with Ningde Times holding a market value of 128.7 billion yuan, an increase of 3.2% from Q1 [6]. - Several brokerages have released optimistic forecasts for the A-share market in the second half of the year, with expectations of a "slow bull" market driven by policy support, structural reforms, and regulatory protection [8]. - The market is anticipated to experience a "wave-like" progression, with potential for upward movement following adjustments, supported by domestic and international catalysts [8].

Core Insights - Northbound capital has continuously increased its holdings in A-shares for two consecutive quarters, with a focus on emerging technology sectors while reducing exposure to food and beverage sectors [1][2] Group 1: Northbound Capital Holdings - As of the end of Q2 2023, Northbound capital held a total of 2,907 stocks, with a total share count of 123.2 billion and a market value of approximately 2.29 trillion yuan [2] - Compared to the end of 2024, the market value of Northbound capital holdings increased by 87.1 billion yuan, and compared to Q1 2025, it increased by over 50 billion yuan [2] - The top five industries by market value held by Northbound capital are batteries (175.4 billion yuan), semiconductors (134.9 billion yuan), liquor (134.1 billion yuan), joint-stock banks (123.4 billion yuan), and white goods (103.6 billion yuan) [2] Group 2: Sector Adjustments - In Q2, Northbound capital showed a structural adjustment in its investments, favoring technology sectors while reducing holdings in consumer stocks [2][3] - The semiconductor sector saw a significant increase in investment, moving from fifth to second place in terms of market value held [2] - Traditional sectors such as non-ferrous metals, transportation, public utilities, non-bank financials, and construction decoration were also favored by Northbound capital [3] Group 3: Individual Stock Performance - The top ten stocks held by Northbound capital include Ningde Times (128.7 billion yuan), Kweichow Moutai, Midea Group, China Merchants Bank, and others, with Ningde Times seeing a 3.2% increase in holdings from Q1 [3] - China Merchants Bank's market value increased by 12.8 billion yuan, making it the top performer among joint-stock banks [3] Group 4: Market Outlook - Several brokerages have optimistic expectations for the A-share market in the second half of the year, predicting a "slow bull" market driven by policy support and structural reforms [4][5] - The market is expected to experience a "wave-like" progression, with potential upward movement following adjustments in high-valuation small and mid-cap stocks [4]

Group 1 - Foreign capital has continuously increased its holdings in A-shares for two consecutive quarters, with a total market value of approximately 2.29 trillion yuan as of the end of Q2 2025, an increase of 871 billion yuan compared to the end of 2024 [3] - The top five industries by foreign capital holdings are batteries, semiconductors, liquor, joint-stock banks, and white goods, with market values of 175.4 billion yuan, 134.9 billion yuan, 134.1 billion yuan, 123.4 billion yuan, and 103.6 billion yuan respectively [3] - There has been a structural adjustment in foreign capital investments, with a shift from traditional sectors to emerging technologies, particularly in the semiconductor sector, which rose from fifth to second place in terms of holdings [4] Group 2 - The banking and industrial metals sectors saw significant increases in foreign capital holdings, with joint-stock banks' holdings increasing by 21.3 billion yuan and industrial metals by 12.3 billion yuan, with Zijin Mining being a notable beneficiary [4][6] - The top ten stocks held by foreign capital include Ningde Times, Kweichow Moutai, Midea Group, and others, with Ningde Times alone having a holding value of 128.7 billion yuan, reflecting a 3.2% increase from the previous quarter [6] - Several brokerages have expressed an optimistic outlook for the A-share market in the second half of the year, predicting a "slow bull" market driven by policy support and structural reforms [8]

Group 1 - Yitong Century won a bid for a communication engineering construction service project from China Mobile, with a total bid amount of 228 million yuan (including tax) [1] - Zhiyuan New Energy plans to repurchase shares worth between 33 million and 66 million yuan, with a maximum repurchase price of 22.00 yuan per share [1] - GAC Group reported April automobile sales of 116,400 units, a year-on-year decrease of 12.66% [2] - JAC Motors reported April automobile sales of 30,764 units, a year-on-year decrease of 3.55% [3] Group 2 - Fosun Pharma's subsidiary received FDA approval for a clinical trial of a live biotherapeutic product aimed at treating androgenetic alopecia [4] - Liangxin Co. obtained multiple patent certificates, including 2 invention patents and 32 utility model patents [5] - Sainuo Medical's two products received medical device registration certificates in Mexico and Ecuador [5] - Huayu Pharmaceutical's two products received marketing approvals in France and Spain [6] Group 3 - Shengnong Development reported April sales revenue of 1.533 billion yuan, a year-on-year increase of 0.68% [6] - Hasi Lian's potassium chloride and sodium chloride injection passed the consistency evaluation [7] - Shapuaisi received approval for a supplemental application for levofloxacin eye drops [9] - Tianyu Biological reported April sales revenue of 59.32 million yuan from pig sales [10] Group 4 - *ST Weihai was pre-awarded a project worth 108 million yuan [12] - Luoniushan reported April sales revenue of 125 million yuan from pig sales, a year-on-year increase of 12.72% [13] - Minhe Co. reported April sales revenue of 68.30 million yuan from chick sales, a year-on-year increase of 0.51% [14] Group 5 - Double Ring Technology's application for a specific stock issuance was approved by the Shenzhen Stock Exchange [15] - Hualu Hengsheng plans to repurchase shares worth between 200 million and 300 million yuan [16] - Baolong Technology plans to repurchase shares worth between 100 million and 200 million yuan [17] Group 6 - Huasheng Technology's subsidiary plans to sell shares of a company for 200 million yuan [24] - *ST Gengxing's controlling shareholder plans to increase holdings worth between 30 million and 60 million yuan [25] - Ruihuatai's shareholder plans to reduce holdings by up to 1% of the company's shares [26] Group 7 - Foton Motor reported April commercial vehicle sales of 54,816 units, a year-on-year increase of 21.63% [20] - China Merchants Bank plans to invest 15 billion yuan to establish a financial asset investment company [22] - Jinchengxin plans to invest approximately 231 million USD in the Alacran copper-gold-silver mine project [23] Group 8 - Zhongji United's controlling shareholder plans to reduce holdings by up to 2% of the company's shares [30] - Ningbo Huaxiang signed a strategic cooperation agreement to strengthen collaboration in various areas [31] - SMIC reported a net profit of 1.356 billion yuan for Q1 2025, a year-on-year increase of 166.5% [32] Group 9 - FAW Fuwi received a project notification to develop seat products for a luxury brand, with a total sales amount expected to be 1.39 billion yuan [33] - Huakang Clean won a bid for a purification project worth 64.425 million yuan [34] - Lihua Co. reported April sales revenue of 1.125 billion yuan from chicken sales [35]