Regarding the trend of A-shares in 2019, institutions generally believe that it will reach the bottom, but there are still differences on the specific trend. These are relevant views from securities companies:
“In 2018, after the sediment has gone down, there will be great differentiation in 2019, structural opportunities emerge, real growth elasticity of small market value is the greatest, allocation of profit counter-cycle and policy counter-cycle varieties.”
“The progress of "Dredge" policy determines the rhythm of A-shares in 2019, focusing on February-April and July-August. It is expected that the growth rate of total A-shares will fall to 5.5% in 2019, but the trend is U-shaped, or better in 2018, A-shares are expected to rebound. It is believed that the liquidity structure determines the height of the market. The marginal increment of indirect financing and direct financing is more significant; the superposition of expected technology cycle and economic cycle determines the technological growth of market style.”
“In 2019, GEM is expected to show a turbulent upward pattern with abundant market vitality and active growth stocks and shell resources; Shanghai Composite Index is weaker than GEM, showing a box-shaped oscillation pattern, and blue-chip shares need to be revalued and returned to gradually follow performance growth.”
“The policy "rebalances" underpins the economy, and the combination of tax reduction, leverage stabilization and reform speeds up the economic restructuring. It is expected that the economic growth rate will bottom out in Q2-Q3 in 2019, and A-shares will also usher in the starting point of bull recovery in the next 3-5 years after the full release of risks. “

Regarding the trend of A-shares in 2019,some agencies are cautious in forecasting:

(1)“ 2019 is the year of the end of the bottom fluctuation, which tends to have full expectations and preparation for the long-term operation of the bottom of the economy. However, the report also has more confidence in the A-share market in the next two quarters.”
(2)“A-shares as a whole are in the second bottom-building stage and the central shock recovery stage from the bottom of the policy to the bottom of the market, and the trend of the whole year may be "N" type.”
(3)“the trend of A-shares in 2019 were relatively optimistic, and the index was expected to oscillate upward.”
(4)“under the influence of the interaction between basic aspects such as continued downward growth, policy underpinning and policy evolution, the stock market may experience the stage of risk releasing and opportunity appearing by the end of 2019, and timing is more critical.”

The following views are about fund inflows:
(1)“The stock market capital supply is expected to improve in 2019. Overseas funds will become an important source of incremental funds, and the approximate rate of margin funds will reverse to the inflow. Specifically, MSCI may increase the proportion of A-shares in 2019, and the scale of foreign capital inflows will continue to expand. This year's large-scale outflow of margin has put pressure on the capital face of the stock market, and as the market warms up, the margin balance is expected to bottom up. Stock repurchase and social security funds will continue to provide liquidity support for the stock market. According to estimates, the total inflow of funds is about 822.4 billion yuan. In terms of capital demand, the financing function of the stock market will be strengthened, and the pressure of lifting the ban on restricted sales will be reduced. The overall revival of merger and acquisition policy will lead to the rebound of refinancing demand, and the promotion of innovation board may make the IPO higher than this year. In addition, in 2019, the scale of lifting the ban on restricted sales decreased, and the pressure of holding reduction decreased accordingly. According to estimates, the total demand for funds is about 737.5 billion yuan. According to comprehensive statistics, the situation of continuous outflow of funds is expected to be reversed in 2019. Net inflows may exceed 80 billion yuan, and in terms of rhythm, the inflows gradually increased in the middle and second half of the year.”

(2)“If the financing policy is relaxed in 2019, optimistically, the margin scale is expected to reach 1-1.5 trillion yuan. At the same time, the potential capital increment is estimated to be 1.3-1.6 trillion yuan, of which the speed of foreign capital inflow and the expansion of passive index funds are particularly noteworthy. In general, the supply and demand of the capital surface of the stock market will be balanced next year, and the overall liquidity will be expected to improve. In terms of incremental funds, it is estimated that the incremental scale of overseas funds will be about 800 billion in 2019. Among them, MSCI is expected to bring an incremental capital of 460 billion yuan. FTSE estimates that FTSE Russell is expected to bring 10 billion dollars of passive capital to A shares. Assuming that Shanghai-London Stock Connect’s daily quota utilisation rate reaches 5%, it is expected to bring an incremental capital of 25-500 billion yuan to A-shares.

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