The chemical industry is experiencing an upturn, and the cycle is expected to recover. Guotai Chemical ETF (516220) rose more than 1.7% intraday.

On March 25th, the chemical industry shows signs of recovery, and the cycle is expected to rebound. The Guotai Chemical ETF (516220) rose over 1.7% during trading.

Shanghai Securities pointed out that the chemical industry is recovering, and the cycle is likely to turn positive. The expected growth rate of industry supply has slowed, and restocking cycles have already begun. At the national level, policies are being strengthened to guide development. The “14th Five-Year Plan” leads high-quality growth from both supply and demand sides: on the supply side, through actions to “counteract involution” and the “dual carbon” goals, outdated capacity is being phased out, and supply structure optimized; on the demand side, efforts are accelerating toward high-level technological independence and self-reliance, with key materials in core areas expected to see rapid development. The promotion of dual control policies on carbon emissions may help increase industry concentration. Meanwhile, new materials sectors such as lithium battery materials and photoresists benefit from the accelerated industrialization of solid-state batteries and the trend of domestic semiconductor substitution, presenting growth opportunities.

The Guotai Chemical ETF (516220) tracks the Sub-Industry Chemical Index (000813), which focuses on specific segments within the chemical industry, including representative companies in chemical products, chemical fibers, and other sub-sectors. The index components are mainly selected from companies with clear main businesses and good market performance, reflecting the allocation and development trends in new materials, fine chemicals, and other areas within the chemical industry.

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