Securities Times News, CICC Research Report stated that the recent index correction has been included in more pessimistic expectations. In the context of the current weakening economic data, if the policy response is appropriate, there is no need to be too cautious about the follow-up market performance. The current market opportunities still exist. Greater than the risk, specifically, 1) The economic stabilization is not a linear recovery, and we also need to pay attention to the follow-up policy response; 2) The valuation of A shares is still attractive, especially the undervalued state-owned enterprises still have room for recovery. And the current overall valuation level of A shares is not high. The CSI 300’s forward P/E ratio is 10.3x, which is still at a historically low level. The CSI 300’s implied equity risk premium is 5.5%, which is 0.8 times higher than the historical average (3.8%) since 2005. Standard deviation, indicating that market sentiment is still pessimistic and overall valuations are still attractive.
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