On February 12, BlackRock made a significant announcement regarding the evolving landscape of global capital marketsIn a time when geopolitical tensions and interest rate uncertainties have created a complex environment, the emergence of DeepSeek, a groundbreaking AI initiative, not only showcases the capabilities of domestic models in competition internationally but also ignites excitement within the AI sectorAdditionally, with the Chinese People's Political Consultative Conference (CPPCC) and the National People's Congress (NPC) scheduled to convene in early March, attention turns to whether the A-share market will experience a resurgence and which sectors should capture investors' interest.

Shen Yufei, Chief Equity Investment Officer at BlackRock, reflected on January's market performance, describing it as a "late spring chill." The broad indices initially faltered before recovering, with the growth sector showing signs of stabilization after a pronounced declineAn analysis of sector performance indicates that metals, banks, automobiles, machinery, and home appliances fared quite well; conversely, non-banking financials, commercial retail, construction decoration, and real estate lagged behind.

As February unfolds, historical patterns suggest that the timing of the "Two Sessions" could catalyze a spring rallyWith external risks becoming more apparent, there is optimism for further improvement in the market following the initial setbacks of springBlackRock is also keen on expanding research into the Hong Kong stock marketThe focus will be on several key investment opportunities: (1) Infrastructure construction and innovative applications within the field of artificial intelligence; (2) Maintaining a close watch on investment prospects arising from high-quality development topics discussed during the "Two Sessions"; and (3) Identifying investment opportunities in domestic demand driven by a wave of equipment renewal and durable consumer goods updates.

However, Shen also provided a cautionary note regarding potential risks, such as international macroeconomic turbulence and policy outcomes that may fall short of expectations.

Meanwhile, Bi Kai, fund manager of BlackRock's Excellence Horizon Mixed Fund, remarked on the dynamics of the opening year of 2025, which has mirrored earlier patterns of modest decline followed by a resurgence

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Fluctuations in exchange rates, market adjustments, and shifts in market style have been prevalent, with structural trends in sectors such as artificial intelligence and robotics gaining tractionHe maintains a relatively positive outlook on the current market positionLooking ahead to the complete year of 2025, if policies continue to be reinforced, there is potential for the market to transition from a liquidity-driven bull phase into a structurally driven bull phase based on fundamentals; however, this transition will require time and ongoing assessment of economic fundamentals in response to policy changes.

Bi has identified four main investment themes to pursue actively:

(1) Improvement in domestic demand triggered by policy stimulus, encompassing industries such as home appliances, food and beverage, textiles and clothing, internet services, light manufacturing, real estate, and machineryHigh-probability directions include investments related to consumer preferences and state-sponsored consumption subsidies, while high-risk opportunities revolve around the end of the real estate price downcycle and any reversal in deflationary pressures.

(2) National security and the drive for technological self-reliance are focal points as well, with key sectors including electronics, communications, media, semiconductors, and machineryAmong industry opportunities, innovations in AI applications and consumer electronics stand out, particularly with anticipated product developments in Apple's supply chain by 2025.

(3) The stabilization of supply expansion and a rebalancing of supply and demand will predominantly affect agriculture, forestry, animal husbandry, fishing, pharmaceuticals, and construction materialsContinuous losses within the supply sector remain an area of concern, and confirmation of a turnaround may not occur until the second half of 2025.

At this juncture, Bi expressed a manageable level of risk regarding a significant market downturn, deeming the current valuations attractive

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