A-shares market closing review | A-shares undergo a sudden change! The three major indexes accelerate their decline in the afternoon with high volume selling, reasons for the sharp drop exposed.

Today, the market experienced a significant decline on high trading volume, with the three major indexes accelerating their drop in the afternoon and narrowing the decrease near the closing bell. The market turnover exceeded three trillion, with a sharp increase of over 700 billion compared to the previous trading day, and over 4300 stocks in both markets fell. Regarding the reasons for the market's decline, some analysis points out that at the Federal Reserve's interest rate meeting last night, the Fed decided to cut rates by 25 basis points, which was within expectations. Additionally, after the rate cut was implemented, some funds may have been cashed out to realize profits. Orient stated that the tech rally driven by liquidity support and restored confidence has not diminished. Recent market disturbances are more related to sector trading and emotional disturbances rather than changing the market's pattern of fluctuation and upward trend. In terms of market performance, tech stocks, particularly those in the semiconductor industry, strengthened once again, with companies like Semiconductor Manufacturing International Corporation, Hygon Information Technology, and NAURA Technology Group hitting historical highs. Siasun Robot & Automation and the automotive industry chain continued to rise, with stocks like Wanxiang Qianchao hitting the limit up. Mining hardware stocks fluctuated upwards, with liquid cooling and optical modules leading the gains. On the other hand, gold and non-ferrous metal sectors continued to decline, with Beijing Xiaocheng Technology Stock leading the drop. Big finance performed weakly, with most brokerages, insurance companies, diversified financial institutions, and banks trading in the red. The pork sector continued to decline. It is noteworthy that more than 10 stocks such as Foxconn Industrial Internet, Zhejiang Sanhua Intelligent Controls, Greatoo Intelligent Equipment Inc., Hunan Kaimeite Gases, Vantone Neo Development Group, Wingtech Technology, and Daoming Optics & Chemical collectively hit the limit down. Looking at individual stocks, 1027 companies rose in both markets, while 4350 fell, with 52 companies maintaining their gains. There were 65 limit-up stocks and 10 limit-down stocks in both markets. By the close, the Shanghai Composite Index fell by 1.15% to 3831.66 points, with a turnover of 1.366 trillion yuan; the Shenzhen Component Index fell by 1.06% to 13075.66 points, with a turnover of 1.7692 trillion yuan. The ChiNext Index dropped by 1.64% to 3095.85 points. Fund Flow Today, major funds focused on acquiring stocks in the pharmaceutical and commercial business, wind power equipment, and automotive service sectors. Stocks like Shenzhen H&T Intelligent Control, Hengtong Optic-Electric, and Sichuan Crun were among the top stocks with net inflows. Key News Recap 1. Exceeding Expectations in Adjusting Pig Production Capacity; Leading Enterprises Ordered to Reduce Production According to sources, the Ministry of Agriculture and Rural Affairs and the National Development and Reform Commission held a forum on pig production capacity adjustment on the 16th. Top pig breeding companies including Muyuan Foods, Wens Foodstuff Group, and Shuangbaitwins attended to analyze and discuss the implementation of production capacity adjustments. A company representative revealed that top companies were required to control production capacity, including reducing the number of breeding sows, lowering output, and maintaining slaughtered pigs at around 120 kg each. "Top companies have also been tasked with reducing the number of breeding sows year-on-year by 2026," the representative added. 2. Huawei's Xu Zhijun: Introducing Ascend 950PR Chip in Q1 Next Year During the Huawei Fully Connected Conference 2025, Huawei's chairman Xu Zhijun announced that the super node has become the new normal for AI infrastructure development. Currently, more than 300 sets of CloudMatrix 384 super nodes have been deployed, serving over 20 customers. Huawei will launch the world's most powerful super node, Atlas 950 SuperPoD, with a computing scale of 8192 cards, expected to be launched in the fourth quarter of this year. In addition, the new generation product Atlas 960 SuperPoD, with a computing scale of 15488 cards, is expected to be launched in the fourth quarter of 2027. Market Outlook 1. Orient: Market remains in high fluctuation, the tech trend remains strong Since the end of August, the market has been experiencing high fluctuation with decreased trading volume. However, many sectors remain structurally active. The tech trend driven by liquidity support and restored confidence has not abated. Recent market disturbances are more influenced by sector trading and emotional disturbances, maintaining the market's fluctuation and upward trend. In terms of sector allocation, attention should be given to short-term concentrated industries such as semiconductors and Siasun Robot & Automation, but caution is needed in decision making. 2. CICC: Short-term liquidity boost benefits small caps and growth stocks How will the Fed's rate cut affect the Chinese market? CICC analysis indicates that in the short term, the liquidity boost may benefit small caps and growth stocks. If domestic policies do not support strengthening this performance, it is essential to focus on the structural support and opportunities in Sino-US mapping. In the current optimistic sentiment, attention should be given to: 1) Sino-US mapping chain, including tech aspects like computing power, Siasun Robot & Automation, and Fruit Chain, as well as tools related to the US real estate chain after the interest rate cut, such as home decoration, furniture, and appliances, and machinery and non-ferrous related to investments; 2) sectors with improved fundamental conditions like the internet, tech hardware, consumer electronics, innovative pharmaceuticals, non-ferrous metals, and non-banking. 3. Goldman Sachs: Maintaining overweight rating on A-shares and H-shares Goldman Sachs maintains an overweight rating on A-shares and H-shares, suggesting buying on dips and highlighting investment themes such as leading private enterprises, artificial intelligence, anti-inward looping, and shareholder returns. Analysts Kinger Lau mentioned in a report that while earnings are essential for sustained market performance, liquidity is also a crucial factor. The current "slow bull" pattern in A-shares appears more stable than before. This article was sourced from "Tencent Stock Selection," edited by Liu Jiayin.