Hexun Investment Advisor Huang Ruzhen: The market on Monday is expected to recover

There was no strong news stimulus over the weekend, except for tensions between the US and Iran, which made Middle Eastern geopolitical conflicts more uncertain. Fortunately, as of now, there should already be some negotiations underway, and it remains to be seen whether they will come to fruition.

Today’s market can only be judged from an emotional perspective. The market environment is naturally looking for recovery, after two consecutive days of closing with over 4,000 green stocks, which is a sign of thawing. Moreover, on Friday’s close, some volume was traded, likely panic selling. However, the strength and sustainability of the recovery should not be overly optimistic; it’s better to participate with a quantitative mindset.

By the end of March, there will be annual reports disclosed, and quarterly reports are also due in April. Since early March, starting with the pre-market video, I’ve been emphasizing a strategy: betting on the growth of annual reports, focusing on themes with stable main businesses. Because this period each year is difficult, core businesses like power and chemicals, which are stable, tend to offer some sustained opportunities. Therefore, I personally don’t see the end for the chemical and power sectors. Given the current market environment, if you don’t understand what institutional focus on core stocks means or lack the stock aesthetic, it’s better not to force trades; just stay in cash and watch the show.

A slightly discussed new direction over the weekend is space photovoltaic related, which is part of the new energy wind, solar, and energy storage diversification. The sustainability seems average. Currently, the market relies heavily on quantitative and sentiment-driven funds, and both existing holders and cautious investors are scared off. Short-term funds are not very willing to act. My personal approach is purely short-term; for medium and long-term, some voices suggest that the market is at a historic low and that bottom-fishing might be tempting. I hope that in two months, investors won’t get wiped out.

For friends who can control their trades during the week, just do so. Unless you believe the current volume can tolerate trial and error, there are mainly two strategies: one is focusing on the core stocks of popular themes, and the other is finding anti-dip stocks that resonate with the index during intraday lows. Essentially, it’s about focusing on core stocks with institutional backing, because the market’s tolerance for risk is low right now. All core stocks with capacity should follow the idea of grouping and collective action. For those looking to buy the front runners and profit from subsequent rebounds, it’s better to hold off for now, as the market doesn’t have that much liquidity.

(Edited by: Zhang Yan)

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