On Tuesday (August 26), all three major A-share indices closed higher, with advancing stocks outnumbering decliners across the market. Total turnover on the Shanghai, Shenzhen, and Beijing exchanges reached 1.82 trillion yuan, a slight decline from the previous session. In today's trading, the financial sector suddenly sprang to life, with brokerage stocks—often dubbed the "bull market banner"—leading the charge. Jinlong Holdings and Xiangcai Securities hit the daily limit up, while robust earnings growth and generous dividend commitments from leading brokers boosted market sentiment. Shenwan Hongyuan noted that brokerage valuations remain at low levels, offering ample upside potential in terms of risk-reward.
Investors may want to closely monitor Brokerage ETF Huabao (512000), which provides one-click access to 49 listed brokerage stocks, serving as an efficient tool that concentrates on top-tier brokers while also covering mid- and small-cap names. Meanwhile, the Hong Kong Stock Connect innovative drug sector continued its upward trajectory, with Innovent Biologics hitting a fresh record high following its earnings release, and the mRNA tumor vaccine theme regaining momentum. The Huachuang Pharmaceutical team believes that a solid industrial foundation is the core support for an optimistic outlook on sector stock prices. For full-chain exposure to innovative drug development, the Hong Kong Stock Connect Innovative Drug ETF Huabao (520880) focuses entirely on R&D-oriented companies in this space.
Nonferrous metals, a sector with standout interim results, remained a focus of attention. Jiangxi Copper hit the daily limit after reporting earnings, attracting net main capital inflows of 1.986 billion yuan for the day, ranking first on the A-share leaderboard for capital attraction. Sinolink Securities pointed out that the nonferrous metals sector has become the most eye-catching offensive mainline in the recent A-share market. The Nonferrous Metals ETF Huabao (159876) covers leading companies across the industry, spanning copper, aluminum, rare earths, gold, lithium, tungsten, molybdenum, and tin.
In the real estate sector, a wave of favorable policies provided a significant boost. The housing provident fund system saw its biggest adjustment in nearly 20 years, while Shanghai introduced the "Shanghai Eight Measures" to ease property market restrictions. Leading developers performed strongly, with Seazen Holdings surging over 6% and Binjiang Group gaining more than 4%. CITIC Securities recommends focusing on leading companies in core cities, while Orient Securities believes investment opportunities at the bottom of this cycle will be more evident in alpha rather than beta. The Real Estate ETF Huabao (159707) brings together nine top-quality developers with a high concentration of central and state-owned enterprises.
From a macroeconomic perspective, the divergence between domestic and overseas economic and policy environments is increasingly apparent. China Merchants Securities stated that pressure on long-end U.S. Treasury yields persists, suggesting investors focus on structural opportunities domestically. Compared to overseas markets, domestic policy implementation has accelerated noticeably, with fiscal and monetary coordination driving further expansion of domestic demand. The "Six Networks" initiative is moving from overall deployment to special planning and major project execution phases. Real estate policies continue to intensify along the lines of provident fund reform and easing demand-side restrictions in first-tier cities. July economic data showed that overall recovery remains relatively weak, with the divergence between new and old growth drivers widening further. High-tech manufacturing, AI computing power, and high-end equipment continue to maintain strong momentum.
In terms of allocation, the brokerage recommends continuing to balance positions along three main lines: technological innovation, manufacturing going global, and low-valuation policy-driven opportunities, with a focus on electronics, mechanical equipment, power equipment, nonferrous metals, and coal.
Section One: The "Banner" Makes a High-Profile Return—How Sustainable Is It? Strong Earnings and "Real Money" Confidence-Building Measures Prompt Institutions to Highlight Brokerage Excess Returns
The return of the "banner" helped push the Shanghai Composite Index back above the 3,900-point level, with the brokerage sector showing broad strength. Jinlong Holdings and Xiangcai Securities sealed limit-up moves, while Changjiang Securities, China Merchants Securities, Guoyuan Securities, and GF Securities also surged in tandem. The Brokerage ETF Huabao (512000) posted a rare substantial gain, breaking through multiple moving averages including the 10-day, 20-day, and 200-day lines.
Analysts suggest that as the market shifts to a range-bound pattern in the second half of the year, the brokerage sector's attractive valuations combined with solid earnings support have rekindled investor interest. Listed brokers have reported strong interim results collectively. Among the 25 constituent stocks of the CSI All Securities Company Index tracked by the Brokerage ETF Huabao (512000) that have disclosed interim earnings, overall net profit surged 51.16% year-over-year. Leading brokers have comprehensively beaten expectations: CITIC Securities reported first-half net profit attributable to shareholders of 23.343 billion yuan, up 69.60% year-over-year, marking its best-ever first-half performance; Guotai Haitong achieved a record profit of 20.26 billion yuan in the first half.
Despite these strong results, brokerage valuations remain at historically low levels. As of August 25, the price-to-book ratio (PB LF) of the CSI All Securities Company Index stood at just 1.25 times, placing it at the 13.21st percentile over the past decade. Meanwhile, substantial dividends, along with share buybacks and increases, have sent a clear signal that listed brokers believe their stock prices are undervalued. To date, 10 listed brokers have announced interim dividend plans, with aggregate proposed payouts nearing 17 billion yuan. Multiple firms, including Guolian Minsheng Securities, Soochow Securities, Industrial Securities, and Hua'an Securities, have implemented buybacks or increased holdings, underscoring their confidence in long-term company value.
Kaiyuan Securities believes that, on one hand, low valuations, low positioning, and improving capital flows form the underlying logic for excess returns in the brokerage sector. On the other hand, continuous record-high ROE, optimized business structures, and enhanced earnings growth potential are key drivers for valuation re-rating. Huatai Securities noted that while market trading activity has cooled in the short term, risk appetite remains supported. During the interim reporting window, earnings delivery from leading brokers remains the main theme, with investment banking, co-investment, proprietary trading, and international business providing incremental support despite valuation pullbacks. The firm recommends seizing the low-valuation allocation window.
The Brokerage ETF Huabao (512000) passively tracks the CSI All Securities Company Index, offering one-click access to 49 listed brokerage stocks. It is an efficient investment tool that concentrates on top-tier brokers while also covering mid- and small-cap names. Over-the-counter investors may consider the feeder funds (Class A 006098, Class C 007531).
Note: As of August 25, 2026, the weightings of Jinlong Holdings, Xiangcai Securities, Changjiang Securities, China Merchants Securities, and GF Securities in the CSI All Securities Company Index were 0.3%, 0.53%, 1.51%, 3.45%, and 3.34%, respectively.
Section Two: Positive Catalysts Pile Up—Hong Kong Stock Connect Innovative Drugs Continue to Climb, 520880 Rallies on Volume! Innovent Hits Record High Post-Earnings, mRNA Tumor Vaccine Theme Reignites
Backed by multiple favorable catalysts, Hong Kong Stock Connect innovative drug stocks extended their strong rally. The Hong Kong Stock Connect Innovative Drug ETF Huabao (520880), which invests 100% in R&D-focused companies, posted consecutive gains on rising volume. Among its constituents, CanSino Biologics led with a 25.99% surge, Innovent Biologics closed up 9.69% at a record high, Akeso gained nearly 6%, and both BeiGene and Sino Biopharmaceutical rose over 2%.
On the news front, the innovative drug sector received a dense cluster of catalysts. First, Innovent Biologics, a sector leader, delivered better-than-expected interim results. First-half product revenue reached 8.202 billion yuan (up 56.7% year-over-year), driving Non-IFRS net profit to 1.704 billion yuan (up 40.5%). Management also unveiled for the first time a blueprint targeting total revenue of 35–40 billion yuan by 2030, with ambitions to become a global, full-value-chain pharmaceutical company. Second, CanSino Biologics and Depusheng Biotech signed a strategic cooperation agreement on August 25 to jointly develop and commercialize mRNA personalized therapeutic tumor vaccines. Third, policy continues to support high-quality development of innovative drugs, with the "15th Five-Year Plan for National Health" and the "15th Five-Year Plan for Universal Medical Insurance" recently released, further improving the full-chain support system for innovative drugs and medical devices.
Wanlian Securities noted that the gradual formation of a three-tier payment system—comprising the basic medical insurance catalog, a special catalog for innovative drugs, and commercial health insurance catalogs—is expected to benefit innovative drug companies and the CXO sector through payment expansion. Regarding how far the innovative drug rally can extend and whether to increase attention at current levels, the Huachuang Pharmaceutical team believes the industry has continued to improve in recent years, with sales values growing annually and both the quantity and quality of out-licensing deals rising. The solid industrial fundamentals serve as the core support for an optimistic view on sector stock prices. While the innovative drug sector currently exhibits high volatility due to quantitative trading and various market narratives, the long-term upward industry trend is highly certain, offering significant long-term investment value. The team recommends maintaining a positive stance on the sector.
For full-chain exposure to innovative drugs, investors can consider two T+0 instruments: the Hong Kong Stock Connect Innovative Drug ETF Huabao (520880), which passively tracks the Hang Seng Hong Kong Stock Connect Innovative Drug Select Index and allocates 100% to innovative drug R&D companies, with 70% of positions in R&D leaders, and its OTC feeder fund (025221); and the Hong Kong Stock Connect Healthcare ETF Huabao (159137), which passively tracks the Hong Kong Stock Connect Healthcare Thematic Index, heavily weighted toward the innovative drug supply chain with 50% CXO and 20% innovative drug exposure, including over 38% in the WuXi group, along with its OTC feeder fund (026922).
Note: The weightings of the mentioned stocks in the Hang Seng Hong Kong Stock Connect Innovative Drug Select Index are as follows: Innovent Biologics 11.42%, Akeso 7.51%, CanSino Biologics 0.39%, BeiGene 11.90%, CSPC Pharmaceutical 10.49%, and Sino Biopharmaceutical 8.00%.
Section Three: Multiple Catalysts Drive Real Estate Surge—CITIC Securities Sees Core City Home Prices Bottoming This Year
The real estate sector rallied throughout the day, with leading developers performing notably well. Seazen Holdings led with gains exceeding 6%, Binjiang Group rose over 4%, and Poly Developments and Shanghai Lingang both advanced more than 2.5%. Among popular ETFs, the Real Estate ETF Huabao (159707) saw rising on-exchange attention.
On the news front, the sector accumulated multiple favorable developments. In terms of provident fund policy, the housing provident fund system recently underwent its biggest adjustment in nearly two decades, continuing to stimulate the sector. Additionally, Shanghai introduced the "Shanghai Eight Measures" to ease property market restrictions, focusing on destocking new homes outside the outer ring road, facilitating upgrades for improving households, activating provident fund accounts, and purchasing second-hand homes in central urban areas.
CITIC Securities believes that while nationwide supply-demand structural improvements will take time, core cities are likely to see home prices bottom out this year. As presale of completed homes advances, competition based on turnover "involution" is expected to be replaced by healthy competition based on quality. Developers focused on core cities and product quality, as well as light-asset management companies with strong brand reputation and service capabilities, are likely to gain competitive advantages.
Regarding allocation, Orient Securities suggests seizing tactical trading opportunities at the end of Q3 and Q4 in the short term. In the medium term, 2027 could mark the starting point for a systematic beta re-rating of the real estate sector, potentially making it an annual trading mainline, with end-Q1 next year serving as an important observation and timing window. Over the long term, investment opportunities at the bottom of this cycle will be more evident in alpha rather than beta.
On the valuation front, leading developers—represented by central and state-owned enterprises and high-quality private firms—remain at low valuations. As of August 26, the CSI 800 Real Estate Index had a latest PB valuation of just 0.5 times, lower than over 98% of the time range in the past decade, clearly indicating low valuation characteristics and potentially significant room for recovery.
For allocation to central and state-owned enterprises and quality developers, investors should focus on the Real Estate ETF Huabao (159707). This fund tracks the CSI 800 Real Estate Index, bringing together top-quality developers with a high concentration of central and state-owned enterprises. In the context of industry consolidation, leading developers may offer greater upside flexibility.
Note: Fee details can be found in each fund's legal documents. Data is sourced from public information from the Shanghai, Shenzhen, and Hong Kong exchanges, CSI Index Company, Hang Seng Index Company, etc., as of August 26, 2026.
Reminder: Market volatility may be significant in the near term, and short-term gains or losses do not indicate future performance. Investors should make rational investment decisions based on their own capital situations and risk tolerance, with close attention to position and risk management.
*Institutional views reference the following sources: Shenwan Hongyuan's August report "Valuing the Allocation Value of the Brokerage Sector"; Sinolink Securities' August 9 report "The Moment of Attention Shift"; China Merchants Securities' August 10 report "Accelerated Policy Implementation, Structural Opportunities Take Priority"; Kaiyuan Securities' August 2 report "Central Politburo Meeting Takes Positive Stance on Stabilizing the Stock Market, Favorable for Non-Bank Excess Returns"; Huatai Securities' August 23 report "Seizing Quality Financial Opportunities Amid Improving Earnings"; Wanlian Securities' August 24 report "Pharmaceutical and Biotech Industry Quick Review: Universal Medical Insurance '15th Five-Year Plan' Released, Focus on Innovative Drugs, Rehabilitation, and Medical IT Opportunities"; Huachuang Securities' August 25 report "Huachuang Pharma Deep Morning Brief: Mid-Year Views on Innovative Drugs"; CITIC Securities' "Two Policy Mainlines, One Policy Goal"; and Orient Securities' "Provident Fund System's Biggest Adjustment in Nearly 20 Years: 'Shanghai Eight Measures' Signal More Than Substance."
Risk Disclosure: The Brokerage ETF Huabao passively tracks the CSI All Securities Company Index, with a base date of June 29, 2007, and a release date of July 15, 2013. The Real Estate ETF Huabao passively tracks the CSI 800 Real Estate Index, with a base date of December 31, 2004, and a release date of December 21, 2012. The Nonferrous Metals ETF Huabao passively tracks the CSI Nonferrous Metals Index, with a base date of December 31, 2013, and a release date of July 13, 2015. The Hong Kong Stock Connect Innovative Drug ETF Huabao passively tracks the Hang Seng Hong Kong Stock Connect Innovative Drug Select Index, with a base date of December 31, 2020, and a release date of July 17, 2023. The Hong Kong Stock Connect Healthcare ETF Huabao passively tracks the CSI Hong Kong Stock Connect Healthcare Thematic Index, with a base date of December 31, 2018, and a release date of July 21, 2022. Index constituent compositions are adjusted in accordance with the index compilation rules, and backtested historical performance does not indicate future index performance. The stocks mentioned in this article are merely objective displays of index constituents and do not constitute stock recommendations, nor do they represent the fund manager's or fund's investment direction. Any information appearing herein (including but not limited to stocks, comments, forecasts, charts, indicators, theories, and any forms of expression) is for reference only. Investors are solely responsible for their own investment decisions. Furthermore, any views, analyses, or forecasts in this article do not constitute investment advice to readers of any form, and Huabao Fund is not liable for any direct or indirect losses arising from the use of this content. Investors should carefully read fund legal documents including the Fund Contract, Prospectus, and Fund Product Information Summary to understand the risk-return characteristics of the fund and select products appropriate to their own risk tolerance. Past fund performance does not indicate future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. According to the fund manager's assessment, the Brokerage ETF Huabao, Real Estate ETF Huabao, and Nonferrous Metals ETF Huabao carry a risk rating of R3 (medium risk), suitable for balanced (C3) and above investors. The Hong Kong Stock Connect Innovative Drug ETF Huabao and Hong Kong Stock Connect Healthcare ETF Huabao carry a risk rating of R4 (medium-high risk), suitable for aggressive (C4) and above investors. Suitability matching opinions are subject to sales institutions. Sales institutions (including the fund manager's direct sales and other sales institutions) conduct risk assessments on the above funds in accordance with relevant laws and regulations. Investors should promptly monitor the suitability opinions issued by the fund manager. Suitability opinions from different sales institutions may not necessarily be consistent, and fund product risk ratings issued by sales institutions must not be lower than those issued by the fund manager. Risk-return characteristics described in fund contracts may differ from risk ratings due to different considerations. Investors should understand the risk-return profile of the fund and carefully select fund products based on their own investment objectives, time horizons, investment experience, and risk tolerance, assuming the risks themselves. Registration of the above funds with the China Securities Regulatory Commission does not indicate a substantive judgment or guarantee of the funds' investment value, market prospects, or returns. Fund investment requires caution.