Core Viewpoint - The article discusses the strong performance of A-shares and H-shares in the Chinese stock market compared to other Asia-Pacific markets, highlighting the potential for foreign capital to increase its allocation to China amid geopolitical tensions [1][3][15]. Group 1: Market Performance - A-shares and H-shares have shown resilience, with a decline of around 1% compared to 5-6% in Japan and South Korea, indicating a "China asset" outperformance [3][4]. - The Hang Seng Index and Wind All A Index have experienced declines of -8.47% and -4.31% respectively, while the Nikkei 225 and Korean Composite Index have seen larger declines [6]. Group 2: Foreign Capital Inflow - There are indications of foreign capital increasing its allocation to A-shares, as evidenced by record high securities investment surpluses in January [15]. - In the Hong Kong market, passive index products have consistently seen inflows, suggesting a trend of foreign investment [16][18]. Group 3: Geopolitical Context - The Hong Kong Financial Secretary noted that ongoing tensions in the Middle East are driving U.S. funds into Hong Kong, as nearly 60% of listed companies are mainland enterprises, providing stability [20][24]. - The diversification of energy imports and proactive energy transition in China are highlighted as strengths in the current geopolitical climate [10][12]. Group 4: Investment Strategy - The article emphasizes that foreign capital is not merely increasing allocations but is also correcting under-allocated positions in China, as evidenced by the low representation of China in global indices [26][30]. - The current low interest rate environment is identified as a significant factor driving investment decisions, with A-shares being viewed as a valuable asset class [35][39]. Group 5: Market Trends and Recommendations - The article suggests that investors should focus on long-term capital and appropriate risk matching, especially in the context of potential market volatility [53]. - It advocates for a diversified investment approach, particularly in high-quality equity investments, as a favorable strategy for ordinary investors [53].

Group 1 - The core viewpoint of the article highlights the positive performance of the petrochemical ETF (159731), which has seen a 0.84% increase, with leading stocks such as Wanhua Chemical, Hengli Petrochemical, and Guangwei Composites showing significant gains [1] - The petrochemical ETF has experienced a total net inflow of 1.095 billion yuan over the past 20 trading days, with the latest share count reaching 1.752 billion and a total scale of 1.874 billion yuan [1] - Analysts predict that the chemical industry, including polyester, will operate under a "de-involution" logic by 2026, moving away from the price-for-volume model, and expect a strong market for polyester in 2026 due to current global uncertainties [1] Group 2 - Southwest Securities believes that the chemical industry is at the beginning of a new prosperity cycle globally, with Chinese chemical companies having strengthened their profit foundations and elasticity over the past few years [1] - The petrochemical ETF and its linked funds closely track the CSI Petrochemical Industry Index, with the basic chemical industry accounting for 60.02% and the oil and petrochemical industry for 32.43% of the index [1] - The new prosperity cycle in the industry is expected to lead to improved profit recovery for downstream chemical products [1]

Market Overview - As of February 24, 2026, the China Petroleum and Chemical Industry Index (H11057) increased by 4.10%, with significant gains from companies such as Andong Biological (up 10.08%), Xingfa Group (up 10.01%), Yuntianhua (up 10.01%), Chuanfa Longmang (up 10.00%), and China National Offshore Oil Corporation (up 8.23%) [1] - The Petrochemical ETF (159731) rose by 4.14%, with a latest price of 1.06 yuan, and recorded a turnover rate of 9.16% during the trading session. Over the past 20 trading days, the ETF attracted a total of 1.239 billion yuan in capital inflow [1] Key News Highlights - The main crude oil futures on the INE rose by 28.70 yuan per barrel, a 6.18% increase, closing at 493.30 yuan per barrel. Related refined oil futures also saw gains, with high-sulfur fuel oil up by 79.00 yuan per ton (2.76%) and low-sulfur fuel oil up by 192.00 yuan per ton (5.84%) [1] - The main synthetic rubber futures increased by 3.74%, with mainstream prices in Shandong rising to 13,300 yuan per ton. The market outlook for synthetic rubber is expected to remain strong due to high raw material costs and recovering demand [1] - The PTA2605 main contract saw an increase of 2.88%. Supply-side data indicates that several facilities are undergoing maintenance, with expectations for operating rates to rise to around 78% post-holiday [2] Institutional Insights - Guotou Securities notes a "rise of the East and fall of the West" trend in the global chemical industry, with European companies reducing production due to high energy and environmental costs. Chinese private refining enterprises are gaining a competitive edge through cost advantages and integrated supply chains [3] - The "PX-PTA-Polyester Filament" industry chain is expected to see improved supply-demand dynamics, leading to enhanced investment elasticity [3] Popular ETFs - The Petrochemical ETF (159731) and its linked funds closely track the China Petroleum and Chemical Industry Index, with the basic chemical industry accounting for 60.02% and the oil and petrochemical industry for 32.43%. This positioning allows for participation in the profit recovery of downstream chemical products [4] - The long-term narrative for the industry is improving due to structural adjustments in supply and demand [4]

Group 1 - The Shanghai Composite Index experienced a seven-day rise, but trading volume continued to shrink, leading to a significant "seesaw" effect in capital allocation and accelerated sector rotation [1] - Ahead of the Spring Festival holiday, funds are divided into two camps: one showing cautious sentiment favoring dividend and free cash flow ETFs, while the other is positioning for a rebound after the holiday [1] - Major ETFs that received significant net subscriptions from external funds include the ChiNext ETF and the CSI 1000 ETF, with industry-specific ETFs like satellite, robotics, AI, semiconductor equipment, and chemical ETFs also seeing strong inflows [1] Group 2 - According to Wang Bo from Huaxia Fund, the reduction in trading volume before the holiday is normal, and there is a general optimistic expectation for the February market, although a short-term recovery in market sentiment will take time [2] - The investment strategy suggested includes maintaining a balanced allocation across technology, cyclical, and consumer sectors through broad-based ETFs like the Hu-Shen 300 ETF [2] - The recent increase in January PPI by 0.4% month-on-month has catalyzed price increases in the chemical sector, while positive developments in robotics and AI models are also emerging [1][2]

Group 1: Report Overview - The report is a weekly strategy report on industry rotation TF from February 2, 2026, to February 8, 2026, released on February 9, 2026 [1][2] - The strategy is based on two previous reports and constructs an ETF - based strategy portfolio [2] Group 2: Investment Recommendations Current Holdings and Changes - ETFs to be continued to hold include Building Materials ETF (159745, market value 21.67 billion yuan), Real Estate ETF (159707, market value 6.40 billion yuan), Petrochemical ETF (159731, market value 17.46 billion yuan), Chemical ETF (159870, market value 340.36 billion yuan), and Rare Metals ETF (562800, market value 62.40 billion yuan) [3] - ETFs to be newly added or adjusted to hold include Tourism ETF (159766, market value 91.07 billion yuan), Wine ETF (512690, market value 192.66 billion yuan), Traditional Chinese Medicine ETF (560080, market value 26.52 billion yuan), New Energy Vehicle ETF (515700, market value 19.75 billion yuan), and Agricultural ETF Harvest (516550, market value 2.03 billion yuan) [3] - ETFs to be removed from the portfolio include Non - Ferrous Metals ETF (512400, market value 352.52 billion yuan), Gold Stocks ETF (517520, market value 151.34 billion yuan), Grain ETF (159698, market value 4.66 billion yuan), Securities and Insurance ETF E Fund (512070, market value 201.73 billion yuan), and Agricultural ETF (159825, market value 26.26 billion yuan) [11] Sector Recommendations - The model recommends allocating to sectors such as cement, real estate development, and airport aviation in the week of February 9, 2026 [12] - In the next week, the strategy will newly hold Game ETF, Wine ETF, Traditional Chinese Medicine ETF, and New Energy Vehicle ETF, and continue to hold Building Materials ETF, Real Estate ETF, and Petrochemical ETF [12] Group 3: Performance Tracking - From February 2 to February 6, 2026, the cumulative net return of the strategy was approximately - 3.85%, and the excess return relative to the CSI 300 ETF was approximately - 2.53% [3] - From October 14, 2024, to February 6, 2026, the out - of - sample cumulative return of the strategy was approximately 38.45%, and the cumulative excess return relative to the CSI 300 ETF was approximately 15.41% [3]

Group 1 - The China Petroleum and Chemical Industry Index (H11057) has seen a strong increase of 2.33% as of February 6, 2026, with key stocks such as Zhejiang Longsheng rising by 7.39%, Huafeng Chemical by 5.68%, and Rongsheng Petrochemical by 5.22% [1] - The Petrochemical ETF (159731) has also risen by 2.32%, with a latest price of 1.01 yuan and a turnover rate of 4.52% during the trading session [1] - Over the past week, the average daily trading volume of the Petrochemical ETF has been 238 million yuan, with a net inflow of 20.89 million yuan recently, totaling 284 million yuan over the last five trading days [1] Group 2 - The Petrochemical ETF has achieved a net value increase of 65.97% over the past two years, with the highest monthly return since inception being 15.86% and the longest consecutive monthly gain lasting for 9 months with a total increase of 60.75% [1] - The ETF's average monthly return during rising months is 5.59%, and it has outperformed the benchmark with an annualized return of 2.32% over the past year as of February 5, 2026 [1] - The Sharpe ratio of the Petrochemical ETF for the past year is reported to be 2.52 as of January 30, 2026 [1] Group 3 - Huaxin Securities maintains a positive outlook on the three major oil companies, particularly China Petroleum and Chemical Corporation, which benefits from lower raw material costs due to declining international oil prices [2] - Private refining companies with high chemical yield and production efficiency are also expected to benefit from the current oil price downturn, with a recommendation to pay attention to Rongsheng Petrochemical and Hengli Petrochemical [2] - The top ten weighted stocks in the China Petroleum and Chemical Industry Index as of January 30, 2026, include Wanhua Chemical, China Petroleum, and China National Offshore Oil Corporation, collectively accounting for 55.71% of the index [2]

Core Viewpoint - The petrochemical industry is experiencing mixed performance, with the China Petrochemical Industry Index showing a slight decline, while certain stocks within the sector are performing well, indicating potential investment opportunities and market volatility [1][2]. Group 1: Market Performance - As of February 5, 2026, the China Petrochemical Industry Index (H11057) decreased by 0.39%, with stocks like Sankeshu, Guangdong Hongda, and Huafeng Chemical leading the gains, while Lianhong Xinke, Cangge Mining, and Salt Lake Co. led the declines [1]. - The Petrochemical ETF (159731) fell by 0.50%, with the latest price at 1 yuan, and had an average daily trading volume of 314 million yuan over the past week [1]. Group 2: Fund Flows - The Petrochemical ETF attracted a total of 611 million yuan over the last five trading days, averaging a net inflow of 122 million yuan per day [2]. - Over the past month, the ETF's scale increased by 1.46 billion yuan, indicating significant growth [2]. Group 3: Price Trends - In January 2026, international oil prices saw substantial increases, with WTI crude oil rising by 13.57% to $65.21 per barrel and Brent crude oil increasing by 16.17% to $70.69 per barrel [2]. - Among 319 tracked products, 207 experienced price increases, with notable rises in liquid chlorine, lithium hydroxide, acetonitrile, lithium carbonate, and butadiene, which saw increases of 71.43%, 44.10%, 32.86%, 25.58%, and 25.31% respectively [2]. - Conversely, 69 products declined in price, with the largest decreases in hydrogen peroxide, nitric acid, caustic soda, kerosene, and argon, which fell by 18.40%, 16.71%, 13.94%, 8.73%, and 8.33% respectively [2]. - Overall, the prices of basic chemical products are beginning to show signs of recovery [2]. Group 4: ETF Performance Metrics - As of February 4, 2026, the Petrochemical ETF's net value has increased by 69.98% over the past two years [2]. - The ETF's Sharpe ratio for the past year, as of January 30, 2026, is 2.52, indicating strong risk-adjusted returns [2]. - The tracking error of the ETF over the past two months is 0.006%, the highest tracking precision among comparable funds [2]. Group 5: Index Composition - The Petrochemical ETF closely tracks the China Petrochemical Industry Index, with the top ten weighted stocks as of January 30, 2026, including Wanhua Chemical, China Petroleum, Salt Lake Co., Sinopec, CNOOC, Cangge Mining, Hualu Hengsheng, Hengli Petrochemical, Juhua Co., and Baofeng Energy, collectively accounting for 55.71% of the index [3].

Group 1 - The core viewpoint of the article indicates that the A-share market is experiencing a rebound after a decline, with various ETFs showing increases and net inflows, suggesting a positive outlook for the continuation of the upward trend in related indices [1] - The CSI 300 ETF (510330.SH) rose by 1.10% on February 3, with a net inflow of 594 million yuan, reversing a significant outflow trend since January 16, and currently has a total scale of 94 billion yuan [1] - The Food and Beverage ETF (515170.SH) increased by 0.73% on February 3, with a net inflow of 26 million yuan, bringing its total scale to 5.7 billion yuan [1] Group 2 - Other ETFs that experienced gains and net inflows on the same day include the Sci-Tech 50 ETF, ChiNext ETF, CSI 1000 ETF, AI ETF, Chip ETF, and Petrochemical ETF [1] - According to a strategy analyst from CICC, the A-share market is expected to undergo short-term fluctuations due to rapid previous gains and the upcoming Spring Festival, but the medium-term factors supporting market performance remain unchanged, indicating conditions for a slow bull market [1] - The current market favors large-cap growth styles, with an increasing number of low-position rebound opportunities emerging [1]

Core Viewpoint - The petrochemical sector is experiencing significant growth, as evidenced by the strong performance of the China Petrochemical Industry Index and related ETFs, indicating a positive market sentiment and investment opportunities in this industry [1][2]. Group 1: Index Performance - As of February 3, 2026, the China Petrochemical Industry Index (H11057) rose by 2.89%, with notable increases in constituent stocks such as Cangge Mining (+6.76%), Hualu Hengsheng (+6.17%), and Guangwei Composites (+5.94%) [1]. - The Petrochemical ETF (159731) increased by 2.87%, reaching a latest price of 1 yuan, and has accumulated a 6.21% rise over the past month [1]. Group 2: Liquidity and Trading Activity - The Petrochemical ETF recorded a turnover rate of 12.19% during the trading session, with a transaction volume of 200 million yuan, indicating active market participation [1]. - Over the past week, the average daily trading volume of the Petrochemical ETF was 329 million yuan [1]. Group 3: Fund Flows and Share Performance - The latest share count of the Petrochemical ETF reached 1.656 billion, marking a one-year high [2]. - The ETF has seen continuous net inflows for 19 days, with a peak single-day net inflow of 348 million yuan, totaling 1.413 billion yuan in net inflows [2]. Group 4: Return Metrics - Since its inception, the Petrochemical ETF has achieved a maximum monthly return of 15.86%, with the longest streak of consecutive monthly gains being 9 months and a total increase of 60.75% during that period [2]. - The average return during the months of increase is 5.59% [2]. Group 5: Index Composition - As of January 30, 2026, the top ten weighted stocks in the China Petrochemical Industry Index include Wanhua Chemical, China Petroleum, and Yilong Co., among others, collectively accounting for 55.71% of the index [2].

Group 1 - The core viewpoint of the article highlights the performance of the Petrochemical ETF (159731), which has seen a 2.05% increase, with top holdings like Zhejiang Longsheng, Guangwei Composites, and Yara International showing significant gains [1] - The Petrochemical ETF has experienced a net inflow of 0.62 billion yuan in the previous trading day, marking 19 consecutive trading days of net inflows, totaling 14.13 billion yuan [1] - The latest share count of the Petrochemical ETF reached 1.656 billion shares, setting a new record since its inception, with a total scale of 1.616 billion yuan [1] Group 2 - U.S. crude oil inventories have decreased to 24.785 million barrels, reflecting a 1.11% week-over-week decline, approaching warning levels [1] - U.S. daily crude oil production has dropped by 36,000 barrels, now at 1.3696 million barrels, influenced by a winter storm that has temporarily reduced production by up to 2 million barrels per day [1] - The overall commodity market is experiencing moderate support, with oil leading the upward trend, as historical data suggests that Brent crude oil typically shows an upward trajectory in February, particularly in the last third of the month [1] Group 3 - The Petrochemical ETF and its linked funds (017855/017856) track the CSI Petrochemical Industry Index, focusing on the "big energy" security logic [1] - The ETF allows investors to benefit from the profit recovery of downstream chemical products while securing upstream resource value through a high allocation to major refining leaders, providing stronger performance resilience during oil price upcycles [1]