Top 10 Chinese Investment Institutions Reveal Their A-Share Market Strategy for the ‘Two Sessions’

• Core Strategy: Shift toward tangible assets and “New Quality Productive Forces”.
• Key Drivers: Policy support from Two Sessions and global rotation away from soft-tech.
• Market Sentiment: Bullish but alert to internal differentiation between mid-cap and large-cap.

Last week, China’s stock market showed solid momentum.

The Shanghai Composite Index climbed 1.98%, the Shenzhen Component Index jumped 2.80%, and the ChiNext Index rose 1.05%.

So what’s next?

We’ve gathered the latest investment strategies from ten of China’s biggest financial institutions to help you understand where the A-share market might be headed.

Here’s what they’re saying.

The Global ‘HALO’ Trade is Reshaping Chinese Markets

One theme keeps popping up across institutional research: the “HALO” trading strategy.

This global phenomenon—where foreign capital rotates away from traditional tech and into hardware, aerospace, energy, and other tangible sectors—is starting to dominate A-share sentiment too.

Last week showed the pattern clearly.

Mid-cap and small-cap stocks outperformed significantly, with the CSI 1000 and CSI 500 (Zhongzheng 500 中证500) indices both rising more than 4% during the week.

The strongest performers included:

• Computing power infrastructure
• Power generation (Dianli 电力)
• Commercial aerospace (Shangye Hangtian 商业航天)
• Pro-cyclical resource commodities

Meanwhile, software and Hong Kong-listed tech stocks took a hit.

According to Shenwan Hongyuan Securities, this is happening because the market is fundamentally rethinking industrial organization in an AI-dominated future.

Industries that rely on monopoly barriers, companies with shrinking profit margins, and tech leaders who may no longer dominate are all facing valuation pressure.

But here’s the key insight: Chinese assets are less exposed to this downside than U.S. stocks.

Why?

China has fewer industrial segments that depend solely on monopoly profits and excess barriers to entry.

Plus, Guojin Securities makes a compelling point—A-share revenue is concentrated in mining and manufacturing, industries that are less likely to be disrupted by AI.

Chinese listed companies also hold a higher proportion of tangible assets compared to their U.S. peers.

As one analyst put it: “China is the ‘HALO’; physical assets are the ‘Ark.'”

Policy Catalysts Are About to Drive Everything

The “Two Sessions” are coming—and they’re going to be important.

China’s National People’s Congress and Chinese People’s Political Consultative Conference meetings will set the policy direction for the next five years, including the framework for the 15th Five-Year Plan.

Galaxy Securities (Yinhe 银河) expects capital to flow heavily into policy-guided industrial themes during this period.

The investment playbook includes two main buckets:

1. “Anti-Involution” & High-Dividend Plays

This covers sectors benefiting from:

• Improved supply-demand dynamics and profit recovery
• Rising geopolitical tensions (boosting gold and oil prices)
• Non-ferrous metals (Youse Jinshu 有色金属) and precious metals (Guijinshu 贵金属)
• Petroleum and petrochemicals (Shiyou Shihua 石油石化)
• Basic chemicals (Jichu Huagong 基础化工)

2. “New Quality Productive Forces” Technology Growth

The domestic economic logic is shifting toward what Beijing calls “new quality productive forces”—basically, next-generation industrial capacity.

Key areas of focus:

• Semiconductors (Bandouti 半导体)
• Artificial intelligence (Rengong Zhineng 人工智能)
• New energy (Xinnengyuan 新能源)
• Humanoid robots (Jihiqiren 机器人)

Huajin Securities expects the “Spring Rally” to continue through March, with policy likely remaining positive during the Two Sessions.

They’re also optimistic about external risks—suggesting China-U.S. relations might see marginal improvement and Middle East conflicts could stabilize through negotiations.

Historical Data Shows Two Sessions Effects Are Real (And Measurable)

If you’re wondering whether the Two Sessions actually matter for stock performance, Soochow Securities (Dongwu 东吴) has the receipts.

Looking at historical patterns:

• The Shanghai Composite Index has an 81% win rate in the 20 trading days before the meetings
• Average gain in those 20 days: 2.40%
• Markets often consolidate during the actual meetings
• 20 trading days after the event: 81% win rate again, averaging 2.44% gains

The pattern is clear—the Two Sessions create a “before and after” effect.

March Could Be Volatile But Likely Up

Most institutions expect March to continue trending upward, though with significant internal differentiation.

Central China Securities (Zhongyuan 中原) expects the core driver to shift from sentiment to actual policy implementation and earnings verification.

On the macro side:

• CPI fell due to seasonal factors, but the decline in PPI is narrowing
• March peak construction season should provide support
• Opportunities outweigh risks

Their recommended strategy: a “balanced growth” approach.

Hold high-dividend assets to weather volatility while positioning in “new quality productive forces” like:

• Software
• Electrical equipment
• Communications (Tongxin 通信)

Zheshang Securities takes a more cautious view, noting that while most indices rose and small/mid-cap stocks outperformed, large-cap stocks lagged significantly.

The Fund Heavyweight Index rose only 1.77%—far weaker than small-cap growth.

They see “catch-up trading” patterns where laggard resource sectors like steel (Gangtie 钢铁) and chemicals (Huagong 化工) are suddenly outperforming leaders.

Their take: the market still needs consolidation, and a real trend-based opportunity may not emerge until mid-March.

The Inflation Narrative Is Gaining Traction

Post-holiday trading is painting a picture of “weak tech, strong inflation”—mirroring the global HALO trade pattern.

Cinda Securities (Xinda 信达) believes geopolitical conflicts will continue strengthening the inflation narrative based on energy security concerns.

This creates structural opportunities in:

• Gold (Huangjin 黄金)
• Oil and gas
• Military industry (Jungong 军工)

The overall direction remains optimistic, but the market may enter a testing period in March as these competing narratives battle for dominance.

Key Takeaways for A-Share Investors

Here’s what the consensus from China’s top 10 institutions actually means:

• The HALO trade is real and spreading: Capital is rotating from pure software and tech into hardware, manufacturing, and tangible assets. Chinese stocks are structurally better positioned than U.S. tech because they’re less monopoly-dependent.
• The Two Sessions matter: Historically, you get positive returns both before and after. March should see policy-driven buying and earnings verification.
• Growth and pro-cyclical sectors are the twin engines: Both benefit from improved sentiment and policy support. New energy, semiconductors, and AI infrastructure are on one side; commodities, gold, and energy on the other.
• Volatility will be there, but the trend looks up: The market needs consolidation mid-March, but the overall trajectory should remain positive through the Two Sessions and beyond.
• Large-cap laggards present opportunity: Don’t just chase what’s working—catch-up trading in overlooked sectors could pay off.

The bottom line: A-shares are entering a policy-driven phase where the fundamentals matter more than sentiment, and the structural case for Chinese physical assets over pure-play tech is getting stronger.

Watch the Two Sessions closely for the policy blueprint that will guide capital allocation through 2026 and into the new five-year plan.

References

• Top 10 Institutions on the Market: Global HALO Trading – Eastmoney Research Center
• Official Website – Eastmoney (Dongfang Caifu 东方财富)
• Finance Channel – Sina Finance (Sina Caijing 新浪财经)
• Financial and Stock News – Cailian Press (Cailianshe 财联社)