Huatai Securities said trading-driven selling has shown initial relief but fresh
incremental capital remains cautious and market liquidity repair has yet to
coalesce. Recent volume contraction mainly reflects reduced domestic trading
exposures, margin-financing activity at a cyclical low and private funds’ lower
sensitivity to the tech sector, suggesting earlier positions have been partly
digested. Leverage stabilization has not produced sustained net inflows; ETF
demand is driven by structural rotation. Overall funding conditions are
improving mostly via reduced selling pressure rather than broad new inflows,
while demand-side funding stress has risen and share unlocks in early October
could add pressure.
