CITIC Securities: Allocation should gradually narrow focus, continuing to concentrate on China's advantageous manufacturing

GateUser-bd883c58 · 2026-04-07T00:15:48+00:00

AskAI · How will PPI transmission after the war subside affect corporate profits?[CITIC Securities: Gradually Narrowing the Allocation Focus, Continuing to Focus on China’s Advantage Manufacturing] Caixin April 6, CITIC Securities Research believes that the possibility of TACO still exists, but market funding patience has already been exhausted. The war is expected to be near its end by the end of this month, but the likelihood of the Strait of Hormuz being “weaponized,” as well as intermittent disruptions across the supply chain, is increasing. Currently, among the five fundamental signals (dividends, going overseas, AI, PPI, and domestic consumption), only PPI, domestic AI, and consumption have not been priced in sufficiently. After the war subsides, the transmission from oil -> PPI -> corporate profits is the most important fundamental factor among them. Domestic AI is a relatively independent industrial shift, while trades related to domestic consumption will most likely lag behind PPI. Of course, the “PPI -> corporate profits” trade will only be triggered once the war ends and oil prices peak. Market

GateUser-bd883c58

2026-04-07 00:15:48

Ask AI · How does PPI transmission after the war’s de-escalation affect corporate profitability?

【CITIC Securities: Positioning should gradually narrow the focus and continue to focus on China’s advantaged manufacturing】, April 6, via Caixin.com. CITIC Securities Research believes that the possibility of TACO still exists, but market funding’s patience has already been used up. It expects the war to be nearing the end toward the close of this month, but the likelihood of the Strait of Hormuz being “weaponized” and intermittent disruptions across the supply chain is increasing. At present, among five fundamental lines of inquiry (dividends, going global, AI, PPI, and domestic consumption), only PPI, domestically produced AI, and consumption have not been adequately priced in. After the war eases, the transmission path of oil -> PPI -> corporate profitability is the most important fundamental factor among them. Domestically produced AI is a relatively independent industrial change, while the trading in domestic consumption is very likely to lag behind PPI trading. Of course, the “PPI -> corporate profitability” trade will only begin once the oil price peaks after the war eases. As the market cools, positioning should gradually narrow the focus, and continue to focus on China’s advantaged manufacturing.

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