On October 29th, Zhang Deli, the Lead Macro Analyst at Zhongtai Securities, observed that the fourth-quarter adjustment in the dual-creation index seems to be more about a valuation recalibration rather than a shift in industry trends or the policy landscape.
On one hand, despite possible short-term market volatility driven by sentiment, the tech industry's fundamentals are expected to stay strong over the medium to long term, buoyed by ongoing policy support for technological independence and self-sufficiency.
On the other hand, given that the dual-creation index encompasses a broad spectrum of industries, the adjustment of the entire index has been largely influenced by fluctuations in certain sectors that experienced substantial early gains. Moving forward, it is advisable to closely monitor shifts in earnings expectations, valuation rebounds, and overall industry trading sentiment.