Today (October 10), A-shares were incredibly powerful, with high-dividend assets collectively surging, qitabankuai following suit and breaking out, the coal sector triggering a surge limit, and the banks sector also showing strong performance. In the Hong Kong stock market, high-yield stocks collectively rose higher, $EB ENVIRONMENT (00257.HK)$Please use your Futubull account to access the feature.$CHINA COAL (01898.HK)$ , up more than 8%, $CHINAHONGQIAO (01378.HK)$Please use your Futubull account to access the feature.$CNBM (03323.HK)$ Up over 6%. $CHINA SHENHUA (01088.HK)$ Rose more than 5%.

Market analysis believes that high-dividend assets have shown strong performance, with three main reasons behind their emergence: the introduction of policies, demand for catching up, and changes in the interest rate environment, all contributing to the strong performance of high-dividend assets. It is expected that this sector still has great potential in the future.

First, policy support: This morning, the People's Bank of China announced the establishment of 'convenience for exchanges between securities, funds, and insurance companies'. The introduction of this policy provides new operational tools for institutions such as securities, funds, and insurance companies. Market participants believe that these institutions may prefer high-dividend assets with stable returns, thus driving the rise of the high-dividend sector.

Second, catch-up demand: In this round of market trends, the performance of high-dividend assets has been relatively lagging. Therefore, as the gains in other sectors have been significant, funds are gradually shifting to high-dividend assets that have not fully risen, creating catch-up demand and driving up the prices of related stocks.

Third, decline in interest rates and support from long-term funds: In the current market environment, the downward trend in interest rates is evident, coupled with the gradual entry of long-term funds, further enhancing investors' interest in high-dividend assets. Especially for some leading dividend stocks with a dividend yield exceeding 5%, this level of return is highly attractive to long-term funds in a low-interest rate environment.

High dividend assets are mainly concentrated in traditional industries such as banks, energy (such as coal, oil), and utilities (such as electrical utilities, water affairs). Due to the stable cash flow and profit patterns of these industries, which are less vulnerable to economic cyclical fluctuations, they are able to consistently provide shareholders with high dividends. Since 2024, the high dividend sector has been widely favored by institutional investors, with the SSE dividend index's stage increase exceeding 20%.

Under the pursuit of funds, many institutional analysts have also provided reasons for being bullish on high dividend assets and have forecasted their future performance.

Taocan from Jianxin Fund believes that the high dividend strategy is particularly attractive in the current economic environment due to its stable stock returns and low valuation, making it a preferred choice for investors seeking to mitigate market risks and pursue stable returns. He also points out that capital inflows have been a key driver of the rise in the high dividend sector, with the influx of southbound funds and the increasing demand from institutional investors for high dividend assets driving up prices.

Xu Chi from Zhongtai Securities points out that public utilities are a niche area in the high dividend strategy, with market-driven tax reforms and pricing mechanisms enhancing the inherent profitability of public utilities, thus increasing their investment attractiveness.

Of course, investors are also concerned about the future upward momentum of high dividend assets and how long the uptrend can be sustained. Fu Jingtao from SWhy believes that the high dividend strategy will not be short-lived but is expected to become a long-term theme in the A-share market. In the relatively scarce quality growth opportunities of 2024, the increase in the dividend proportion of high dividend assets makes it the most certain investment direction.

Is such assets still worth paying attention to, and is there still sufficient upside potential? He Jie from Ping An Fund believes that new policies (such as the "Nine Articles") encouraging listed companies to increase dividend payouts have created a market environment that places greater emphasis on shareholder returns. The high dividend strategy is in line with the current stage of market development, but value investing still needs to focus on entry prices. Soochow Securities stated that under the pressure of an "asset shortage," absolute return funds (such as insurance funds) will continue to increase their allocation to undervalued high dividend assets. With current interest rate trends declining, the trading of these assets has not yet reached its peak, and there is still room for valuation recovery.

In summary, multiple institutions believe that high dividend assets have long-term investment value, with policy support, capital inflows, and valuation advantages being key driving factors for their outstanding performance.

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Editor/Somer