Market Recap Last week's market performance was mixed, with major indices showing divergent movements. The ChiNext Index and the STAR 50 Index rose over 3.4%, while the Beijing Stock Exchange 50 Index experienced a significant pullback, declining more than 4%. The Hang Seng Tech Index fell over 3%, with other indices generally showing narrow-range fluctuations.
From the perspective of Shenwan primary industries, communications, electronics, and machinery equipment performed relatively well, while non-ferrous metals, steel, and beauty & personal care sectors showed relatively weaker performance.
Market News Regarding the initial outcomes of China-U.S. economic and trade consultations, a spokesperson stated that preliminary achievements have been made in several areas. Both sides will continue implementing prior agreements and have reached positive consensus on tariff arrangements. They have agreed to establish trade and investment councils to address respective concerns, discussing tariff reductions for specific products and agreeing in principle to reduce tariffs on products of mutual concern. Efforts will be made to resolve or substantially advance issues related to non-tariff barriers and market access for certain agricultural products. Both sides will promote two-way trade expansion, including in agricultural products, through reciprocal tariff reductions. Arrangements have been made for China's procurement of aircraft from the U.S. and the U.S. guarantee of aircraft engine and component supplies to China, with cooperation in related fields to continue. The spokesperson emphasized that the positive results demonstrate the ability to find solutions through dialogue and cooperation based on mutual respect and equality. Details are still under discussion, with teams working to finalize outcomes and ensure implementation to inject more certainty and stability into bilateral economic cooperation and the global economy.
The Ministry of Foreign Affairs announced that Russian President Vladimir Putin will pay a state visit to China from May 19 to 20 at the invitation of the Chinese President.
The Inter-ministerial Joint Conference Office for the Construction of a Strong Intellectual Property Nation issued the "2026 Intellectual Property Power Construction Promotion Plan," outlining key annual tasks and directions to advance the entire chain of intellectual property creation, utilization, protection, management, and services, supporting innovation-driven development.
Wind data shows that as of May 15, 600 A-share listed companies have invested a total of 261.247 billion yuan in wealth management products this year, a year-on-year decline of 50.14%, reflecting significant changes in the allocation of idle corporate funds. Among them, 140 companies have purchased securities firm wealth management products, with the proportion of such products increasing compared to the same period last year.
In April, the bank wealth management market achieved growth in both scale and returns. Data indicates that by the end of April, the total scale of bank wealth management reached 34.5 trillion yuan, an increase of 2.6 trillion yuan from the end of March, hitting a record high, with fixed-income product yields rebounding significantly.
Global bond markets are undergoing another intense repricing. Driven by soaring energy prices and rising inflation expectations, government bond yields in the U.S., Japan, Germany, and the UK have collectively risen. The U.S. 10-year Treasury yield reached its highest level in a year. Japan's 30-year government bond yield exceeded 4% for the first time since its issuance in 1999, while the 40-year yield rose to 4.23%, a record high since its introduction in 2007. The UK's 30-year gilt yield hit its highest level since 1998, with the 10-year yield reaching a peak since 2008. Germany's 10-year bund yield climbed to its highest since 2011.
Data released by the National Bureau of Statistics shows that in 2025, the average annual wage for employees in urban non-private units nationwide was 129,441 yuan, an increase of 5,331 yuan from the previous year, with real growth of 4.2% after price adjustments. For employees in private units, the average annual wage was 71,590 yuan, up 2,114 yuan, with real growth of 2.9%.
The China Securities Regulatory Commission held a symposium on capital market support for modern service industries and new consumer enterprises, engaging in in-depth discussions with representatives from domestic and foreign listed companies and businesses in sectors such as smart consumption, trendy domestic products, modern logistics, and IP cultural creation. CSRC Chairman Wu Qing stated that more specific measures to deepen inclusive reforms and promote high-quality capital market development are under study.
Data from the People's Bank of China shows that in the first four months of this year, RMB loans increased by 8.59 trillion yuan. The cumulative increment in aggregate social financing was 15.45 trillion yuan, 893 billion yuan less than the same period last year. At the end of April, M2 balance grew by 8.6% year-on-year. The outstanding aggregate social financing stood at 456.89 trillion yuan, up 7.8% year-on-year. In April, the average interest rates for newly issued corporate loans and personal housing loans were both approximately 3.1%. New loans in April recorded a historically rare negative value, with industry experts suggesting that slower loan growth may become the new normal.
As market activity has further increased since May, various institutions have intensified their research on listed companies to explore potential investment opportunities. Data indicates that over 1,700 listed companies have received institutional visits since May, a significant increase month-on-month. By sector, machinery equipment has surpassed electronics as the most scrutinized industry, with pharmaceutical and biologicals, as well as power equipment sectors, also drawing considerable institutional attention.
Chinese scientists have successfully developed the "Jiuzhang 4" programmable quantum computing prototype, featuring 1,024 quantum compressed state inputs and 8,176 modes. It can manipulate and detect up to 3,050 photons, establishing the strongest "quantum computational advantage" internationally.
This year, China has accelerated its layout for future industries. Focusing on key areas such as general artificial intelligence, quantum technology, atomic-level manufacturing, and clean low-carbon hydrogen, the country has deployed over 100 "unveiling the list and appointing leaders" innovation tasks for future industries, constructing a batch of typical application scenarios. Simultaneously, a systematic layout of manufacturing innovation centers and pilot platforms for key future industry sectors has been initiated.
In response to prominent issues such as unclear sources and difficulty in verifying the authenticity of some short video content, the Cyberspace Administration of China has comprehensively deployed and advanced the standardization of short video content labeling. It mandates the setting of six types of labels, including "contains AI-generated content," making content labeling a mandatory step in short video publication, with requirements for retrospective and supplementary labeling of existing short videos.
Data from the China Automobile Dealers Association shows that in April, the comprehensive inventory coefficient for automobile dealers was 1.89, up 7.4% month-on-month and 34% year-on-year. According to the China Passenger Car Association, passenger car terminal sales in April reached 1.384 million units. Based on this calculation, total dealer inventory at the end of April was approximately 2.6 million vehicles.
An unprecedented shortage has emerged in the gas turbine industry. The "2026 Gas Turbine Industry Development White Paper" indicates that global gas turbine demand in 2025 was about 90-100 GW, but annual production capacity was only 55-60 GW, resulting in a supply-demand gap of 30-40 GW. The white paper predicts that this global market imbalance will persist at least until 2030.
Domestic route fuel surcharges are set to increase starting May 16, with charges of 90 yuan for routes under 800 km (inclusive) and 170 yuan for routes over 800 km, up by 30 yuan and 50 yuan, respectively. Last month, domestic fuel surcharges increased fivefold. Typically adjusted on the 5th of each month, this month's adjustment was delayed to the 16th.
The Iranian President stated that shipping traffic will return to normal once instability in the Strait of Hormuz ends. The Chairman of the Iranian Parliament's National Security Committee, Aziz, indicated that within the framework of safeguarding national sovereignty and ensuring international trade security, Iran has formulated a professional traffic management mechanism for the Strait of Hormuz route, which will be officially announced soon. This mechanism is only open to merchant ships and relevant parties cooperating with Iran. Iran will charge necessary fees in exchange for the professional services provided through this mechanism. The route will remain closed to participants of the U.S. "Freedom Plan."
U.S. sources suggest that the U.S. and Israel may resume military strikes against Iran as early as next week. Currently, U.S.-Iran negotiations are deadlocked. U.S. President Trump reiterated that Iran's proposal to end the war is "unacceptable," though he has not yet decided on the next steps.
The U.S. Senate has formally approved Kevin Warsh as Chairman of the Federal Reserve. The Senate had previously approved Warsh as a Federal Reserve Governor for a 14-year term. With this appointment as Chairman, Warsh will officially assume his role after completing relevant White House signing procedures, succeeding current Chairman Powell, whose term ends on May 15.
Market Outlook Guosen Securities notes that since April, the A-share market has rebounded significantly, primarily driven by the return of active funds, with household funds continuing to enter the market. As tensions in the Middle East eased since April, market risk appetite has noticeably recovered, leading to a stronger A-share performance. Firstly, the return of previously outflowed active funds is likely the main driver, such as accelerated inflows of leveraged funds since April, potential significant short-term foreign capital inflows, and likely high participation from private equity in the April rally. Secondly, household funds may still be flowing in, and based on mutual fund inflows, household funds likely continued the inflow trend from Q1. Additionally, insurance funds may also be reallocating capital. Since the beginning of the year, the process of household funds entering the market has been favorable, with potential for further incremental inflows within the year. Looking at capital flows since the start of the year, the volume of household funds entering the market has been significant in both the volatile Q1 market and the rebound since April, indicating that the pace of household fund inflows has accelerated compared to 2025. Looking ahead, there may still be room for incremental household fund inflows within the year. Based on calculations, it is estimated that net capital inflows into the A-share market for the full year could reach 2 trillion yuan. From a short-term perspective, given the market's sustained rise since the end of March, there is some profit-taking demand, which may lead to inevitable market fluctuations. However, from a medium-term perspective, multiple positive factors support an unchanged upward trend. In terms of structure, a balanced allocation is recommended. While the technology sector has accumulated significant gains earlier, it remains a main theme from a medium-term view. Additionally, attention should be paid to traditional assets such as baijiu and real estate, as well as the resource sector.
Everbright Securities highlights policies and meetings, including the central bank's release of the Q1 monetary policy execution report and U.S. President Trump's visit to China. On May 9, the Premier chaired an executive meeting of the State Council. On May 11, the People's Bank of China released the "2026 First Quarter China Monetary Policy Execution Report." At the invitation of the Chinese President, U.S. President Trump is paying a state visit to China. This marks another face-to-face meeting between the leaders of China and the U.S. since last October in Busan and the first visit by a U.S. President to China in nine years. Short-term disturbances are unlikely to alter the market's upward trajectory. On one hand, although geopolitical tensions in the Middle East persist, with related uncertainties not entirely dissipated, the market's sensitivity to marginal changes in the Middle East situation has gradually dulled after prior adjustments, and the short-term disturbances from risk aversion are continuously weakening at the margin. On the other hand, listed companies' performance is gradually improving. As the impact of external risk factors diminishes, the certainty of domestic listed companies' fundamentals may become the core force supporting the market's gradual rise in the next phase. Additionally, the U.S. President's visit to China after nine years sends a clear positive signal and is expected to positively influence market sentiment. Views on industry allocation for May: focus on growth. The overall market may be in a "weak reality, strong sentiment" scenario, corresponding to a market style that is likely to favor growth in May. Industries scoring high on the five-dimensional industry comparison framework include national defense and military industry, computers, electronics, non-ferrous metals, machinery equipment, and power equipment. These sectors may warrant close attention in May.