The valuation recovery rally that began in August has lifted the share prices of several listed construction machinery companies out of "below-net" territory, but expectations of slowing macroeconomic data in Q4—especially real estate data—will still affect the sector's recovery process.

　　Supported by July data such as new real estate construction starts, construction machinery share prices bottomed out and rebounded from mid-August. Shenyin & Wanguo believes that the core factor supporting construction machinery share price performance is the growth rate of new real estate construction starts, and a rebound in this data helps the performance of construction machinery stocks. However, in August, new real estate construction starts fell 20.1% year-on-year and 9% month-on-month. As a result, construction machinery listed companies' share prices surged and then fell back this month, with the sector averaging an 8.62% decline from September 12 to date, significantly weaker than the Shanghai Composite Index's 3.62% drop over the same period.

　　It is worth noting that several brokerages have published research reports judging that real estate data in September or Q4 may continue to decline. China Merchants Securities said it expects fixed asset investment to remain stable growth in September, but with more of the growth contributed by infrastructure investment; it expects the year-on-year growth rates of new real estate construction starts and sales data in September to continue declining due to base effects, and the probability of slower real estate investment growth is rising.