Guotai Haitong: Market volatility intensifies, recommend overweighting A-shares, US stocks, crude oil, and industrial commodities in February.

Guotai Haitong released a research report stating that the liquidity crisis will exacerbate market volatility, accelerating the repricing of major asset classes. Based on unchanged fundamental pricing factors, global equities and commodities may still have performance opportunities. It is recommended to overweight A shares, US stocks, crude oil, and industrial commodities in February. Guotai Haitong's main points are as follows: The bank has constructed a "all-weather" major asset allocation framework consisting of strategic asset allocation (SAA) - tactical asset allocation (TAA) - major event review and adjustment, to serve as a comprehensive guide for investment decisions. This framework first disperses macro risks through SAA, setting the long-term benchmark allocation to ensure portfolio stability; TAA identifies assets with better short-term risk-return characteristics through quantitative methods and adjusts the portfolio weights moderately to enhance profitability; finally, subjective review of major events corrects and supplements the quantitative results. The bank believes that the liquidity crisis will accelerate the repricing of major asset classes, and based on unchanged fundamental pricing factors, global equities and commodities may still have performance opportunities. It is recommended to overweight A/H shares, US stocks, crude oil, and industrial commodities in February. The recommended equity allocation weight for February 2026 is 47.50%: overweight A shares (10.00%), overweight Hong Kong stocks (10.00%), overweight US stocks (17.50%), standard European stocks (5.00%), and standard Japanese stocks (5.00%). In the equity assets, (1) multiple factors support the performance of Chinese equities, and it is recommended to overweight A/H shares. With the economic work conference approaching, 2026 is the beginning of the 15th Five-Year Plan, and it is expected that the broad deficit will further expand, with more proactive economic policies. The US Federal Reserve lowered interest rates in December as expected, the renminbi stabilized and appreciated, providing favorable conditions for China's loose monetary policy at the beginning of 2026. Reforms boost risk appetite in the Chinese market. The market volatility caused by the liquidity crisis is actually a good opportunity for A/H shares. (2) The background of the "Golden Haired Girl" is gradually favorable for the performance of US stocks, and it is recommended to overweight US stocks. The US economy is cooling marginally but still resilient, and the internal inflation stickiness is gradually weakening, with earnings expectations potentially supporting the upward trend in the core of US stocks. The recommended bond allocation weight for February 2026 is 35.00%: long-term government bonds (7.50%), short-term government bonds (10.00%), long-term US bonds (7.50%), short-term US bonds (10.00%). In the bond assets, (1) structural monetary policy may strengthen government bond allocation. The imbalance between financing demand and credit supply is still an objective reality, but the trend of risk appetite is upward, and households and enterprises may rebalance their asset allocations. Previously, the bond market was relatively sluggish due to the lack of effective allocation forces, but with the reinforcement of the structural monetary policy, the willingness of allocation funds to buy bonds may be strengthened. (2) The US economy is marginally converging but not slowing down, the labor market is moderating, and weak energy prices and slow wage growth are favorable for the gradual decrease in internal inflation stickiness. Trump's nominee for Federal Reserve Chairman, Powell, advocates for balance sheet reduction and a moderate decrease in monetary policy rates, and subsequent US bond rates are expected to gradually decrease. However, the Trump administration is practicing hegemonism, disrupting the international geopolitical order, significantly weakening the US sovereign credit, and global central banks and large pension funds trend to reduce their holdings of US bonds, making US bonds have a very low risk-return ratio compared to other major asset classes. The recommended commodity allocation weight for February 2026 is 12.50%: standard gold (5.00%), overweight crude oil (3.75%), and overweight industrial commodities (3.75%). In the commodity assets, (1) the geopolitical situation in the Middle East is intensifying, and it is recommended to overweight crude oil. Global oil demand is relatively weak, OPEC+ decided to continue the production freeze in March, and the recent intensification of geopolitical tensions in the Middle East may temporarily boost oil prices. (2) Expectations for demand growth and sustained trading momentum are high, and it is recommended to overweight industrial commodities. Industrial metals represented by copper are currently in a situation of supply-demand imbalance. Construction, power grid, and electric vehicles are the main drivers of demand, and the expansion of AI computing power and modernization of the power grid bring new structural demands, while the development costs and complexity of copper have significantly increased. Risk warning: there are limitations in the analysis dimension, subjectivity in model design, deviations between historical and expected data, market consensus adjustments, and limitations of quantitative models.