CITIC Securities: More Market Disruptions Expected for A-Shares in the Third Quarter

CITIC Securities said investors have diverged on how China’s A-share market may perform in the third quarter after a short-term rebound. According to Jin10, a CITIC Securities research note said its assessment was based on three dimensions: fundamentals, liquidity, and risk appetite. The note said the broad direction of fundamentals in the third quarter had not reversed, but it added that disruptive factors were expected to increase noticeably compared with the first half of the year. It said the frequency and magnitude of short-term rebalancing could be higher than in the second quarter. The report also said conditions for a major medium-term market rotation were not yet in place and that further confirmation would be needed after developments materialize.