A-share closing review | Funds intervened to protect the market! Several ETFs traded heavily.

Today the market continued to adjust, with the Growth Enterprise Market Index showing some resistance to the decline. The Shanghai Composite Index saw three consecutive declines, and the number of stocks hitting the limit down increased significantly. Active funds flowed out of micro-cap stocks, shifting focus back to traditional blue-chip stocks. Earlier strong themes such as retail, AI applications, etc. all receded, with high positions stocks like Zhejiang Yiming Food, Shandong Huifa Foodstuff hitting the limit down; leading stocks like Maotai Index, Ning Combination showed strength with stocks like BYD Company Limited, Kweichow Moutai, Contemporary Amperex Technology leading the gains. Several Shanghai and Shenzhen 300 ETFs saw significant volume increase in the afternoon, with Huatai Bairui Shanghai and Shenzhen 300 ETF turnover exceeding 5 billion yuan. The total market turnover for the day was 1.5 trillion yuan, with a decrease of over 180 billion compared to the previous trading day, and over 4700 stocks fell in both markets. Three major changes occurred in A shares today, sparking discussion on whether the market style will switch. Firstly, there were over 170 stocks hitting the limit down today, and most of the stocks hitting the limit down were recently strong stocks, such as Jianshe Industry Group, Xiamen Sunrise Group, Zhejiang XCC Group, Guangxi Oriental Intelligent Manufacturing Technology, etc. Secondly, the recently active consumer stocks suddenly pulled back, with sectors like film and television, tourism hotels, community group buying, retail, etc. experiencing a sharp decline. Thirdly, micro-cap stocks and low-price stock indices that were recently strong saw a large decline, with the micro-cap stock index falling by nearly 6%, while the Shanghai and Shenzhen 300 and Shanghai 50 indices rose. Regarding the style switch between large and small caps, Huajin Securities stated that the occurrence of a style switch between large and small caps is not common at the end of the year. Since 2010, there have been 5 times when small caps switched to large, and 5 times when large caps switched to small. Only 3 times did the style switch occur in November or December. The main factors affecting the style switch between large and small caps are policies, external events, liquidity, and profitability. Looking at individual stocks, there were 553 gainers in both markets, 4794 decliners, and 30 stocks remained flat. There were a total of 31 limit-up stocks and 171 limit-down stocks in both markets. At the close, the Shanghai Composite Index fell by 0.73% to 3361.49 points, with a turnover of 584.8 billion yuan; the Shenzhen Component Index fell by 0.35% to 10537.43 points, with a turnover of 925.6 billion yuan. The Growth Enterprise Market Index fell by 0.02% to 2201.18 points. Market trend Today, main funds focused on grabbing communication equipment, liquor, passenger cars, and other sectors for investment. Leading stocks with the highest net inflows from main funds included ZTE Corporation, Kweichow Moutai, Tianyu Digital Technology, etc. News recap 1. ByteDance denies cooperating with ZTE Corporation to establish a new brand Regarding the online rumors of cooperation between Douyu and ZTE Corporation, a relevant person from Douyu stated that the news was not true. Douyu has had deep cooperation with many mobile phone brands, but has not explored the possibility of establishing a new brand with ZTE Corporation, nor has there been any cooperation on chips. 2. Ministry of Industry and Information Technology's Raw Materials Division: is organizing the revision of the method for replacing steel production capacity and will conduct research on the development plan for the steel industry in the "15th Five-Year Plan" period At the "Standards Upgrade Leads to Optimization and Upgrading of Raw Materials Industry and Promotion of New Industrialization" press conference held by the Ministry of Industry and Information Technology, Chang Guowu, the director of the Raw Materials Industry Division, said that the Ministry of Industry and Information Technology is currently working with relevant parties to revise the method for replacing steel production capacity, promote the optimization and restructuring of industry organization layout, and promote reduced-volume high-quality development. At the same time, research will be conducted on the development plan of the steel industry in the "15th Five-Year Plan" period to comprehensively analyze the new situation facing the development of the steel industry. 3. China's transit visa-free policy is comprehensively liberalized and optimized, with the stay time for transit visa-free foreigners in China extended to 10 days from today The National Immigration Administration announced on December 17 that it will comprehensively liberalize and optimize the transit visa-free policy, extending the stay time for transit visa-free foreigners in China from the original 72 hours and 144 hours to 240 hours (10 days), and adding 21 new ports as entry and exit ports for transit visa-free personnel, further expanding the area of activities. Personnel from 54 countries including Russia, Brazil, the UK, the US, Canada, etc., who meet the conditions and transit through China to a third country (region), can enter China visa-free through any of the 60 opening ports in 24 provinces (regions, cities), and stay in the designated area for up to 240 hours. Market outlook 1. Guotai Junan: The cross-year rebound trend will continue, but the focus will be on individual stocks and themes Guotai Junan believes that a long-term variable is unfolding, with the decline in risk-free interest rates driving incremental funds into the market; the bond interest rate breaking 2% will gradually reduce investors' interest in bonds and increase their interest in stocks and equities. Unusual statements from high-level meetings support market sentiment and liquidity, with the stock index expected to be mainly volatile in the next stage, and the cross-year rebound trend will continue, but the focus will be on individual stocks and themes. Focus on the decline in risk-free interest rates and bullish on technology and consumption. 2. EB SECURITIES: Market style may switch from thematic speculation to high-dividend blue chips EB SECURITIES believes that the market is undergoing an adjustment to digest previous profit-taking; after the end of two heavyweight meetings, various departments will take action one after another, releasing specific favorable policies that are expected to stabilize the market and see a rebound; meanwhile, the market style may switch from thematic speculation to high-dividend blue chips.