Great Wall Fund says China A-share market is in a consolidation phase: market
activity remains but risk appetite has weakened as investors cash out high-flyer
growth positions without forming a new coordinated bid. Leadership is shifting
from a single tech-driven spillover to a more balanced pattern — core tech
retained, dividend and defensive sectors providing support, and
healthcare/consumption rotating in. Outlook: expect continued churn and
short-term volatility, but a low probability of breaching prior lows. Tactical
focus: 1) energy-security and dividend assets such as oil & petrochemicals, coal
and banks — rationale is stable cash flow with oil at mid-to-high levels and
defensive characteristics from low valuations; 2) concentrated AI hardware plays
—Prioritize optical modules, switches, servers, PCB, semiconductor
equipment/materials and HBM where mid-year results and order visibility can
verify demand; 3) pharmaceuticals and select domestic-demand resilient sectors —
low crowding and earnings potential to help hedge Tech volatility.
