What happened
Huajin Securities reviewed historical September performance for A-shares, noting that since 2010 the Shanghai Composite has tended to be range-bound with an upward bias: it rose in 9 of 16 Septembers and fell in 7. The firm attributes September moves mainly to policy and external events, fundamentals, and liquidity.
Looking at drivers, Huajin says positive policy or external events tend to make September stronger, while tightening policy or negative external events can weigh on it. In the nine winning years, rebounds in manufacturing PMI, property sales, retail sales or export growth were also present, and liquidity also played a role.
For this September, Huajin expects policy and external events to be relatively positive, with possible US-Iran talks and a possible China-US leaders' meeting. It also sees the economy and earnings continuing to recover, exports holding high growth, infrastructure investment stabilizing, high-tech manufacturing staying strong, and retail sales stabilizing. Liquidity is expected to stay loose, with stock-market fund inflows improving marginally.
Why it matters
The report suggests a constructive but cautious view: rather than a strong rally, investors should expect a range-bound market with upward bias. The emphasis on growth and cyclical styles points to opportunities in sectors tied to AI, policy-supported tech, and metals.
If the cited conditions hold — supportive policy, easing external tensions, recovering fundamentals and loose liquidity — the market could reward an offensive tilt. But the report's own risk warnings highlight that historical patterns may not repeat, and policy or external surprises could change the picture.
Key facts
Since 2010, the Shanghai Composite rose in 9 of 16 Septembers and fell in 7.
Huajin says September A-share moves are driven mainly by policy/external events, fundamentals, and liquidity.
Huajin sees growth and cyclical styles as relatively favored in September, with large/small cap style balanced.
What to watch next
Watch whether US-Iran negotiations and a possible China-US leaders' meeting actually materialize and improve sentiment.
Track economic indicators such as exports, infrastructure investment, high-tech manufacturing, retail sales, and corporate earnings for signs of continued recovery.
Monitor liquidity conditions and capital inflows, as well as the Fed's rate decision, for confirmation of the expected supportive backdrop.