Recently, U.S. stocks have experienced periodic fluctuations due to the adjustment of the Fed's policy tone and liquidity fluctuations. Under the seemingly mild index correction, the market's internal structural differentiation has shown significant characteristics. Based on multi-dimensional in-depth research and judgment on macro cycles, profit trends, policy logic and market capital flows, the Wmax research team believes that the current fluctuations have not only not changed the mid-term upward trend of US stocks, but have provided a high-quality window period for bargain hunting.

From the perspective of cycle positioning and earnings fundamentals, Wmax found through continuous tracking of the breadth of U.S. stock EPS corrections that recent earnings forecast adjustments have shown an upward inflection point. Combined with the structural characteristics of the U.S. economic growth momentum, the team has determined that it is currently in the early stage of the growth cycle. This judgment forms a differentiated perspective from the "end of cycle" generally recognized by the market, and is supported by core earnings data:

Net income expectations for U.S. stocks continue to rise in the next 12 months, with small-cap stocks showing the most outstanding elasticity of earnings improvement. The overall market's earnings per share growth forecast of 17% is also significantly higher than Wall Street's consensus estimate of 14%, laying a solid foundation for the index's mid-term upside. It is worth noting that although the S&P 500 index has only corrected about 5% from its historical high, Wmax found by tracking the market value of the top 1,000 heavyweight stocks in the US stock market that two-thirds of the underlying stocks have fallen by more than 10%. This structure of "moderate surface and deep internal adjustment" has actually completed the full release of market risks.

At the policy and liquidity level, Wmax's macro research team cross-verified through macro variables such as the labor market and the Treasury's capital flows and believes that the current combination of risk asset fluctuations and liquidity tightening may instead strengthen the Federal Reserve's forward-looking easing logic— —The weak labor market and periodic liquidity constraints will further increase the probability of an interest rate cut in December. Recent statements by core Federal Reserve officials have confirmed this policy deduction. Relevant signals have received market feedback through the periodic strength of "interest rate cut beneficiary stocks", forming an important policy support for the mid-term market.

From the perspective of market structure and technology, Wmax's trading strategy team judged that the early sell-off in U.S. stocks has basically come to an end based on the dual confirmation of key moving average technical support and systemic fund flows: the S&P 500 Index and the Nasdaq 100 Index have found solid support near the 100-day moving average, and systemic institutions such as volatility control funds have turned to net buying. The market washout in November has fully reset crowded trading positions, clearing the way for a rebound at the end of the year. Combining historical seasonal patterns and the cyclical characteristics of momentum strategies, the team specifically pointed out that the phased correction of momentum stocks in November has released short-term pressure in advance. Coupled with the performance resilience of the core targets of the AI ​​industry chain and the support of relevant industrial policies, momentum stocks are expected to usher in a trend rebound in December and become one of the important main lines of the market at the end of the year.

At the industry allocation level, Wmax has formed a clear differentiated allocation framework based on the cross-screening of profit elasticity, capital rebalancing trends and policy sensitivity: On the one hand, the consumer discretionary, small-cap stocks, healthcare, financial and industrial sectors are worthy of focus - among them, the allocation recommendations for consumer discretionary are based on the team's forward-looking judgment based on the three major trends of "wallet share shifting from services to goods, interest rate decline expectations, and release of pent-up demand", breaking the market's underweight inertia for this sector in the past three years.

On the other hand, small-cap stocks have become the core flexible targets for mid-term allocation due to their outstanding profit upside potential, while momentum stocks are expected to achieve periodic strong performance with the help of year-end capital reallocation and seasonal effects. It is worth mentioning that the current allocation performance-price ratio of large-scale technology stocks is relatively weakened, which is not only due to the possible risk of covering losses in some leading stocks, but also related to the adaptability of the aforementioned structural trends.

In the end, the Wmax research team combined core variables such as earnings growth momentum, policy easing expectations, and market risk release levels to form a clear prediction of the mid-term target range for U.S. stocks: the S&P 500 index is expected to touch the 7,000-7,800 point range within 12 months. This judgment is not only based on the fundamental support of earnings growth, but also fully considers the resonance effect of technical repairs and capital reflows. Wmax always adheres to the research logic of "data-driven, cross-validation, and reverse layout". Through panoramic tracking and rigorous deduction of macro, meso, and micro data, it provides investors with fundamental support and implementable allocation reference. The structural opportunities under the current market fluctuations are an important practical window for this research and judgment system.