Investment Outline and Outlook After the Spring Festival of 2026

I personally prefer investing by sector—focusing exclusively on strong or trend-driven sectors. Below are the sectors I favor for investment after the Spring Festival of 2026. (For reference only; I am an amateur investor.) Chemicals: Core rationale: Overseas capacity exits and China’s push against ‘internal overcompetition’ will drive a recovery in profitability and a re-rating of valuations for Chinese chemical enterprises. See UBS Research Report: 'China Chemical Industry—At the Dawn of a New Upcycle': UBS Upgrades Target Prices for Chinese Chemical Companies. UBS-preferred subsectors: PX/PTA, potash fertilizer, organosilicon, TDI, and lithium hexafluorophosphate (AI search can identify corresponding industry leaders). Investors seeking lower risk may opt directly for a chemicals ETF. My personal views: ① The chemicals sector attracts many cyclical investors—and unlike tech stocks, it rarely experiences speculative, explosive rallies. Its typical pattern is steady, sustained gains without frequent limit-up moves. ② Many chemical stocks trade at relatively low P/E ratios—significantly lower than today’s sky-high valuations in the tech sector. Risk appetite naturally drives capital into low-valuation sectors. For reference, over the past quarter, the U.S. Dow Jones Industrial Average outperformed the Nasdaq. ③ Hot sectors such as commercial aerospace, data centers, and semiconductors may boost demand for novel chemical products and chemical equipment—creating a ripple effect. Chemicals serve as a foundational industry for numerous others. Nonferrous Metals (Gold): The commodity bull market during interest-rate-cutting cycles remains intact; capital seeks assets to speculate on—and during rate-cut cycles, money needs tangible assets to generate returns.

The Coal Chemical Industry Concept Continues to Gain Strength! A List of Leading Coal Chemical Stocks for 2026

Since the beginning of this year, new policies promoting clean and efficient coal utilization have taken effect—accelerating coal’s transformation from a conventional fuel into a high-value feedstock. UBS is bullish on China’s chemical industry, forecasting the start of a three-year upcycle. Meanwhile, geopolitical tensions have pushed oil prices higher, further amplifying the cost advantage of coal-based chemical production. Amid this confluence of favorable catalysts, the coal chemical industry concept has continued gaining strength. Below, we outline key drivers behind this trend and provide a list of leading coal chemical stocks—offered for reference only. What Are the Key Drivers of the Coal Chemical Industry Concept? 1. Implementation of New Policies on Clean and Efficient Coal Utilization The recently issued 'Benchmark and Reference Levels for Key Areas of Clean and Efficient Coal Utilization (2025 Edition)' promotes upgrading the coal industry—from low-end to high-end—and shifting coal products from primary fuels toward high-value-added products. Coupled with an annual growth of 20–30 million tons in coal consumption for chemical feedstock in China, long-term demand is rising steadily—accelerating industry consolidation and structural optimization. 2. UBS Bullish on a Three-Year Chemical Industry Upcycle UBS believes that, under the combined influence of multiple positive factors, China’s chemical industry will enter a new upcycle from 2026 to 2028—with meaningful profit recovery and valuation re-rating expected. After four years of adjustment, the industry has bottomed out: capacity expansion has slowed, valuations sit at historical lows, and fund allocation ratios are rebounding. Moreover, the Producer Price Index (PPI)—which reflects price trends and magnitude changes across the production sector—is expected to turn positive, offering ample room for both earnings and valuation recovery—highlighting clear investment value. 3. Rising Oil Prices Boosting Coal Chemical Industry Prosperity Higher international oil prices have widened the oil–coal price spread, significantly enhancing the cost advantage of coal-based chemical production. Leading firms in the sector enjoy controllable costs and rising product prices—resulting in continuously improving profitability and heightened market attention—rapidly lifting the sector’s overall prosperity. List of Leading Coal Chemical Stocks Reportedly, there are 33 A-share listed companies categorized under the coal chemical industry concept—spanning traditional areas such as coal coking, calcium carbide production, and coal-based ammonia (fertilizer), as well as advanced coal chemical fields including coal-to-alcohols, coal-to-olefins, coal-to-natural gas, and coal-to-oil.