It has been two years since the September 24 market rally, and multiple government departments in China have rolled out a basket of heavyweight policies to stabilize the property market and boost economic performance. This will play a certain role in driving the A-share market in the fourth quarter.

On September 28, the State Council executive meeting arranged the introduction of incremental policies; on September 29, the central bank stepped up with PSL rate cuts and increased relending quotas. Three departments issued a mortgage interest subsidy policy to stabilize the housing market. The introduction of this series of policy measures is aimed at enabling the economy to improve somewhat in the fourth quarter and allowing the property market to stabilize.

Since the second quarter, China's economy has shown signs of slowing growth, and the real estate market has continued to adjust, showing shrinking transaction volumes and sluggish home prices. GDP growth slipped from 5% in the first quarter to 4.3% in the second quarter, and the third quarter also faces considerable growth pressure. In particular, although various measures have been taken this year to boost consumption, including increasing national subsidies and trade-in programs, the growth rate of total retail sales of consumer goods fell from 1.7% in March to 1.4% in August. Loans from both the corporate and household sectors have fallen significantly. In July, new loans dropped by about 340 billion yuan, while deposits continued to grow. This also shows that, with economic growth slowing and decelerating, households have low income expectations, making it difficult to effectively boost consumption. The cumulative decline in real estate development investment also widened month by month from negative 10.7% in February, reaching negative 19.7% by August. Therefore, introducing this kind of package of policies is very necessary.

The central bank cut the one-year pledged supplementary lending rate by 0.25 percentage points to 1.5%, and at the same time brought six networks into the PSL support scope for the first time. PSL stands for pledged supplementary lending, a medium- and long-term low-cost funding tool provided by the central bank to policy banks. Lowering the PSL rate is equivalent to a fiscal policy. The central bank also raised its relending quotas: the quota for relending for technological innovation and technological upgrading was increased by 200 billion yuan to 1.4 trillion yuan, and the support ratio was raised from 60% to 100%. The quota for relending to support agriculture and small businesses was increased by 500 billion yuan to 4.85 trillion yuan, of which the relending quota for private enterprises was increased by 300 billion yuan to 1.3 trillion yuan. This is an important manifestation of support for the private economy.

The more important policy is the nationwide mortgage interest subsidy policy. The Ministry of Finance, the central bank, and the National Financial Regulatory Administration jointly issued a notice on implementing the interest subsidy policy for residents' home purchase loans, making it clear that starting from October 1, 2026, the policy will be implemented nationwide for a trial period of one year. This policy has several features. First, it precisely targets first-home buyers with genuine needs, covering purchases of first homes, including new homes and second-hand homes, but not replacement of existing loans, with the purchased housing area not exceeding 120 square meters and the total price not exceeding 1.5 million yuan, strongly supporting these buyers with genuine needs. Second, the subsidy intensity is an annualized 1%, up to 1 million yuan, for a maximum of five years. Based on the current level of first-home commercial mortgage rates, this is equivalent to a direct interest rate discount of one-third. Taking a long-term loan of 1 million yuan as an example, interest payments could be reduced by nearly 50,000 yuan at most, directly lowering the monthly payment pressure on families with genuine housing needs. In terms of funding sources, the central government provides the ultimate guarantee for the subsidy funds, with the central and local finances sharing them at a 9:1 ratio. The policy clearly states that all eligible cases should be subsidized, with no upper limit on the total scale of funds, and the central government has already made full budgetary arrangements. Fourth, the process is simplified, with banks handling it automatically.

These measures are also intended to stabilize the property market. The current downturn in real estate has seriously affected the wealth effect of households. Of course, this mainly targets third- and fourth-tier cities, since in first- and second-tier cities there are indeed very few homes priced below 1.5 million yuan, so the scope of subsidies is relatively small. But combined with the new real estate policies introduced on August 28, namely extending the loan term from 30 years to 40 years and what you see is what you get, meaning sales of completed homes, and other measures, the goal is the same: to stabilize the property market.

The State Council executive meeting also arranged to promote employment and increase income in parallel, expand domestic demand, and pay more attention to residents' purchasing power. This means efforts must be made on household income. Because the most critical thing in boosting consumption is to raise residents' income levels; if income levels are not high, consumption will find it hard to pick up. This fiscal interest subsidy is conducive to boosting housing demand and easing the drag of real estate on domestic demand. However, how effective the policy will be still needs further observation.

For our stock market, this counts as a favorable policy. Because the policy has improved expectations for the real estate chain, the real estate sector has also seen a sharp rise recently. Going forward, attention should be paid to actual real estate transactions and prices to see whether this is sustainable. We follow real estate not to invest in real estate, but to watch its impact on the stock market. As we know, confidence in the current A-share market is very weak overall. Especially after the continued sharp decline in the third quarter, many technology stocks have nearly halved from their relative highs, and everyone's confidence has been shaken. At this time, introducing a basket of heavyweight policy positives from the policy side is also intended to boost investor confidence and stabilize the market's downward trend.

This year, the Shanghai Composite Index has basically operated in a range of around 3,800 to 4,200. At 4,200, there will be some cooling pressure, while at 3,800, some policy positives need to be introduced to push the market to maintain this long-term slow bull pattern. Therefore, from the policy perspective, the support for this round of slow bull and long bull market has not changed. So looking for a bear market now, I actually think the direction is wrong. Overall, this is still a structural bull market. In the fourth quarter, there may be a decent rebound.

From the perspective of sectors, sector rotation in the fourth quarter will be relatively fast, unlike the first half of the year when technology stocks stood out alone. For example, in the fourth quarter, the six major tracks I mentioned since the beginning of last year may take turns performing. These six major tracks are: the first major track is chips and semiconductors, and the second major track is computing power. These two tracks are the directions that benefit most from AI technology. After sharp gains over the past two years and a full correction in the third quarter, they now once again have the momentum to lead the market. The third major track is humanoid robots, which have recently begun to stir. In the fourth quarter, Musk's new-generation robot Optimus 3 may officially debut, and it has now completed its final design. Recently, Tesla has increased its procurement of components in Suzhou and other places, which is an important signal. Once Tesla's new robot is released, attention to the humanoid robot sector will rise sharply, and a decent rebound may occur. Recently, due to breakthroughs in solid-state battery technology, the fifth major track, the solid-state battery sector, has also shown obvious performance, even seeing a wave of limit-up moves at one point. Solid-state batteries are an important direction for breakthroughs next year. Replacing liquid batteries with solid-state batteries can greatly improve battery safety. This is conducive to enhancing the competitiveness of current electric vehicles, reducing the possibility of explosions and fires, and doubling driving range. In commercial space, SpaceX recently successfully conducted the 14th launch of Starship, successfully placing more than a dozen large satellites into space at once. Starship weighs 100 tons and is the largest rocket ever built by humanity. Its successful launch directly reduced launch costs by 90%, which is conducive to promoting the development of commercial space. Therefore, commercial space is also a direction worth watching in the future. The sixth major track is innovative drugs. Innovative drugs rose against the trend in July this year and delivered a relatively good performance. Although there has been some pullback recently, CXOs and innovative companies that can truly go global and have core R&D capabilities can continue to be watched going forward.

Today is the last trading day before the National Day holiday, and market turnover shrank to 1.3 trillion yuan, but the trend was volatile, and many sectors have begun to stop falling and rebound. This is also consistent with the traditional holiday effect. Before a long holiday, turnover generally shrinks, and investors trade more cautiously. Many investors worry that unexpected declines in overseas markets during the National Day holiday may affect the post-holiday market, so they reduced positions in advance. This risk-averse sentiment is understandable. After the holiday, the market still has some rebound momentum. In advance, I wish investors across the country a happy National Day and family happiness, and a peaceful National Day holiday. We also hope that in the fourth quarter, the market can have a decent upward move and win a beautiful turnaround battle. A MACD golden cross signal has formed, and these stocks are rising well! Sina statement: This news is reprinted from a Sina partner media outlet. Sina publishes this article for the purpose of conveying more information and does not mean it agrees with its views or confirms its description. The article's content is for reference only and does not constitute investment advice. Investors operate at their own risk based on this.