recently, the etf (exchange-traded fund) market has shown active trading trends, becoming a focal point for investors. with its characteristics of flexibility, transparency, and low cost, etfs have attracted significant capital inflows. driven by multiple factors, the etf market continues to fluctuate, providing investors with abundant investment opportunities.

based on the latest market data, etf trading volumes have significantly increased, indicating strong investor interest in etf products. for instance, the shenzhen etf index performed robustly on september 27, 2024, closing with a 6.29% gain and a trading volume of 663 million shares, amounting to a turnover of 72.308 billion yuan. this data reflects not only the active trading environment but also hints at the future development prospects of the etf market.

additionally, the hong kong etf market is showing strong recovery momentum. by the close on friday, all three major indices had risen over 3%, with the hang seng technology index surging nearly 6% to 4453.24 points, over a thousand points higher than at the start of the month. on september 27 alone, the turnover of all etfs in hong kong reached 76.7 billion hkd.

faced with such strong market performance, the surge in hong kong etf trading volumes directly reflects the warming of the stock market and underscores investor interest in these products. both trading volume and turnover have seen substantial growth, indicating an active trading environment and signaling that the hong kong etf market is entering a phase filled with opportunities.

fundamentals:

fiscal policy and stimulus plans: on september 24, the people's bank of china governor pan gongsheng announced three monetary policy support measures, including a total reduction in reserve requirement ratios and interest rates, as well as policies supporting the real estate market. this includes guiding commercial banks to lower existing mortgage rates and creating tools to support the stock market.

experts from the chinese academy of social sciences have noted that current fiscal policy is somewhat pro-cyclical rather than counter-cyclical, but the government still has considerable room for expansion. they advocate for the government to actively reserve projects and launch a comprehensive package of policies, including fiscal and monetary stimulus plans, to drive economic recovery. this policy direction is expected to inject new vitality into the etf market, particularly for products related to infrastructure investment.

international market dynamics: globally, the renminbi has recently shown a trend of two-way fluctuations, influenced by policies boosting economic recovery expectations and the weakening of the dollar due to fed rate cuts. fluctuations in international commodity prices, such as oil and gold, also provide trading opportunities for related etf products. for example, although comex gold prices have slightly declined, they remain high, attracting significant safe-haven capital.

consumption and real estate markets: on september 26, the central committee of the communist party of china held a meeting to analyze the current economic situation and clarify a new positioning for the real estate market. the meeting did not mention "housing is for living, not speculation," and for the first time proposed "promoting stability in the real estate market." haitong securities believes that with the expansion of fiscal and monetary policy, more real estate policies aimed at stabilizing demand, reducing inventory, and improving supply may be introduced to promote industry recovery.

as the national day holiday approaches, the consumption market is entering a traditional peak season. recent consumer promotion policies, such as the 150 billion yuan special bonds for replacing old consumer goods, have been fully allocated to localities. subsequent consumption-promoting policies may further increase, potentially improving the consumption industry's fundamentals.

new energy and technology sectors: the new energy and technology sectors have always been hot topics in the hong kong etf market. with global emphasis on clean energy and technological innovation, related etf products like new energy vehicle etfs and semiconductor etfs are highly sought after. moreover, the financial regulatory bureau's optimization study of the pricing coefficients for new energy vehicle insurance further promotes the development of the new energy industry.

Major banks optimistic about the hong kong market

Wind data shows that as of september 26, there are 2632 hong kong stocks held by international intermediaries, with 1001 foreign institutions buying hong kong stocks in the past week, accounting for about 38.03%. at the beginning of september, foreign investment giant allianz established its first public fund aimed at the chinese market, selecting hong kong stocks as a key investment direction.

Citi international stated that as the federal reserve enters a rate-cutting cycle and china timely implements a series of significant monetary policy support measures, hong kong stocks are expected to benefit from improvements in both domestic and foreign liquidity, as well as global capital rebalancing, leading to a phase of upward movement. the bank believes that further fiscal measures to boost domestic demand will help improve consumption, and positive changes are anticipated on the micro front, positioning hong kong stocks for a rebound.

foreign major banks also express a positive outlook on the future trend of hong kong stocks. goldman sachs released a research report indicating that, given the stronger earnings revision trend, more attractive absolute valuations, and supportive southbound capital flows, along with heightened sensitivity to federal reserve actions during the rate-cutting cycle, the bank is more optimistic about hong kong stocks.

morgan stanley also noted that with the recent rate cuts by the federal reserve, the liquidity in the hong kong market may have greater upside elasticity.