Yang Delong: A bull market that lasts for more than two or three years can effectively stimulate consumption

Recently, the market has repeatedly fluctuated around 4000 points, while technology stocks that have gained large gains in the previous period have experienced a significant correction. In particular, the "Seven Sisters of Technology" of U.S. stocks have fallen many times recently, causing many investors to worry: Is the technology market driven by artificial intelligence facing risks? If U.S. technology stocks fall sharply, will it significantly affect the technology market of A-shares and Hong Kong stocks? The first thing to be clear is what it means for the market to break through 4000 points. Many people are worried that after the market rises to 4000 points, the structural market may end, and there will be repeated shocks and consolidations at this position in the future. This possibility does exist, but it does not mean the end of this bull market. A more reasonable judgment is that in the remaining month or so at the end of the year, the market may fully exchange chips through repeated shocks, laying a solid foundation for next year's market.
I think before 4000 points is the first half of the bull market. At this stage, technology stocks outperformed others, other sectors performed relatively poorly, and the structural bull market characteristics were obvious. This year's A-shares have shown a "dumbbell" structure as a whole-this is a point I have repeatedly emphasized since the beginning of the year. At one end of the dumbbell is the low-valuation, high-dividend sector represented by banks, and at the other end are technology growth stocks. These two types of assets have become the most prominent mainlines this year. Recently,Agricultural Bank's share price hit a record high, and its market value has leapt to the top in the entire market.This phenomenon further confirms that the "dumbbell-shaped" structure is being strengthened day by day. On the other hand, technology stocks have also performed well this year, but due to the excessive increase in the previous period, there will inevitably be a certain adjustment. However, the current correction in technology stocks caused by profit-taking may not be the end of the bull market logic. Looking forward to 2026, the A-share market is expected to gradually shift from the current structural bull market to a comprehensive bull market, and more sectors will have the opportunity to rise. This year, many traditional sectors have been jokingly called "old stocks" by investors and their performance has continued to be sluggish; technology stocks have been called "small stocks"; and the energy storage, nonferrous metals, military industry, power equipment and other sectors in between are classified as "middle stocks". I think the evolution law of this round of bull market is roughly reflected in: market funds took the lead in laying out the "Xiaodeng" sector, then spread to the "Zhongdeng" sector, and finally gradually covered the "Laodeng" sector, reflecting the trend of sector rotation.
This rule can also be explained from a financial perspective. In the first half of the bull market, over-the-counter funds were not willing to enter the market. The overall liquidity of the market was relatively limited, and funds tended to concentrate on investing in technology stocks to obtain higher returns. As the market broke through 4000 points, the bull market trend was further established, and more incremental funds began to flow to the "medium listed stocks". Because their performance expectations were better than the "old listed stocks", there was a significant increase before and after the disclosure of the third quarterly report. As for the "old stocks", although the results of the third quarterly report generally fell short of expectations, and some companies even experienced significant declines, this is more due to cyclical factors. Once the economic fundamentals recover, the trend of these traditional sectors is expected to stabilize and recover.For newly admitted funds, investment preferences are divided: some investors pursuing high growth may continue to deploy technology leaders with greater flexibility; others with lower risk appetite value high dividend yields and traditional white horse stocks. The brand value and stability of stocks. Therefore, in 2026, the A-share market is expected to usher in a stage of accelerated sector rotation and market spread, showing a comprehensive bull market pattern. This means that both technology stocks and traditional sectors will have their own opportunities, but the timing and magnitude of the rise will be different. I think this round of market is a slow bull and long bull, which may last for two to three years, or even three to five years. Under the slow bull and long bull pattern, investors are more likely to obtain stable returns. In contrast, fast cows and mad cows often rise and fall violently, and many investors have difficulty grasping the rhythm. When they rise, they have no time to make arrangements, and when they fall, they suffer heavy losses.
Recently, there has been a heated discussion on "whether the bull market can stimulate consumption". I have always insisted that a healthy bull market is one of the most effective means to boost consumption and the key to breaking the current situation. Some people quoted Teacher Li Xunlei's research and pointed out that the stock market cannot directly stimulate consumption. The basis is that after the end of the past few bull markets, the Shanghai Composite Index has returned to below 3000 points. Most investors actually lost money and did not really increase their wealth. On the contrary, wealth was concentrated in a few people, which suppressed the overall consumption tendency. However, this conclusion is based on the specific background of history that "the cow is short and the bear is long, and the index returns to zero". The core feature of this round of slow cattle and long cattle is that after the market rises, it will not easily return below 3000 points.Assuming that this round of bull market finally stabilizes above 4000 points, the overall investor wealth will still increase compared with the previous bottom of 3000 points. Even if individual performance is differentiated, with some making profits and others losing money, as a whole, residents 'financial assets have achieved a net increase. If the market continues to expand upward on this basis in the future, it will form a sustained wealth effect, which will effectively promote consumer confidence and spending. This is the important feedback effect of the slow bull market on the real economy. It should also be pointed out that the Shanghai Composite Index, as a comprehensive index, continues to expand its sample size. The constituent stocks include not only companies with growing performance, but also a large number of companies with pressure or even decline in performance. Since the pulling effect of rising stocks on the index is often offset by the dragging effect of falling stocks, this internal hedging makes the overall upward trend of the index relatively limited. In contrast, the Shenzhen Stock Exchange Index is adjusted every six months to achieve the survival of the fittest, which can better reflect the results of economic transformation and the performance of high-quality enterprises. Despite this, the Shanghai Composite Index as a whole has remained undervalued over the past decade. Therefore, leaving the bottom area of 3000 points and standing above 4000 points is a reasonable goal worth looking forward to.
Near the end of the year, market volatility may increase, and some investors choose to take profits, resulting in a phased contraction in trading volume and intensified shocks. This is normal.From the perspective of investment strategy, in the first half of the bull market before 4000 points, positions can focus on high-dividend sectors or technology growth stocks; after entering the second half, the sector rotation may accelerate, with "small stocks","medium stocks","old stocks" may have opportunities, and the allocation needs to be more balanced to avoid excessive concentration, so that you can attack and retreat and defend. At the current key index level, the differences between long and short sides have increased, and confidence is particularly important. Investors are advised to maintain confidence and believe that this round of slow bull market will be an important wealth growth opportunity in the future. Finally, it is recommended that you actively learn the concept of value investment, insist on being shareholders of high-quality companies, or participate in the market by allocating high-quality funds, and strive to share the long-term dividends of China's economic transformation and upgrading and capital market development.
(The author is chief economist and fund manager of Qianhai Open Source Fund)