A-shares market review | A-shares surge and then fall back, with the Shanghai Composite Index falling by 0.25% on low trading volume. Traditional Chinese medicine stocks lead the gains.

On February 6th, the three major indices opened low and rose throughout the day, but closed with a decrease. At the close, the Shanghai Composite Index fell by 0.25%, the Shenzhen Component Index fell by 0.33%, and the Growth Enterprise Index fell by 0.73%. The total turnover of the Shanghai and Shenzhen stock markets was 2.15 trillion yuan, a decrease of 30.5 billion from the previous trading day. It is worth noting that yesterday was the "gold out" day of the week, and after today's closing, there are only 5 days left in the Year of the Snake stock market. From historical experience, no matter how the overall market trend is, there is always a period of speculation before the Spring Festival, and early investment will also be reflected in the market. For example, before and after the Spring Festival of the Year of the Snake, investors in directions such as DeepSeek and human-shaped Siasun Robot & Automation mostly had good returns. A research report by the Fangzheng Strategy Team pointed out earlier that there is a certain regularity in the market trends before and after the Spring Festival - the market usually enters an "adjustment period" in the two weeks before the festival, with risk appetite converging; the week before the festival shifts to a "recovery period", with sentiment gradually warming and the market generally stabilizing and rebounding. In terms of market performance, the chemical industry concept including dyes was strong, with many stocks like Hebei Jinniu Chemical Industry and Cangzhou Dahua hitting the limit up; the oil and gas industry chain rose in the afternoon, with Geo-Jade Petroleum Corporation and Xinjiang Zhundong Petroleum Technology hitting the limit up; the lithium battery materials concept collectively rose, with Tonze New Energy Technology and Ningbo Shanshan hitting the limit up; the traditional Chinese medicine concept was strong all day, with Teyi Pharmaceutical Group and Hunan Hansen Pharmaceutical hitting the limit up; the photovoltaic equipment concept rose in the afternoon, with GCL System Integration Technology hitting the limit up; the power equipment and other electricity concepts rebounded, with Jinneng Holding Shanxi Electric Power and San Bian Science & Technology hitting the limit up; the PEEK and human-shaped Siasun Robot & Automation concepts were strong, with many stocks like Kailong High Technology and Zhejiang XCC Group hitting the limit up. In terms of decliners, the "old Deng" concept had a one-day decline, with the large consumer concepts of liquor, tourism, retail, duty-free shops, and food and beverage all declining, and stocks like Gansu Huangtai Wine-Marketing Industry and Baida Group Co., Ltd hitting the limit down; real estate and urban village transformation concepts declined, with Metro Land Corporation falling by over 7%; some AI application concepts such as AI comics, AI marketing, media, and AI movies declined again, with Zhewen Interactive Group approaching the limit down; the aerospace concepts like large aircraft, aviation engines, and commercial aerospace were weak again, with Fujian Tendering falling by nearly 10%; the domestic hard technology concepts such as semiconductors, chips, and advanced packaging continued to decline. Hot sectors: 1. Traditional Chinese medicine concept leading the way Stocks related to traditional Chinese medicine surged, with Teyi Pharmaceutical Group, Hunan Hansen Pharmaceutical hitting the limit up, and Gansu Longshenrongfa Pharmaceutical Industry, BIOVALLEY, and Jiangxi Wannianqing Cement following suit. Analysis: On the news front, the Ministry of Industry and Information Technology and eight other departments issued the "Implementation Plan for the High-Quality Development of the Traditional Chinese Medicine Industry (2026-2030)." The plan proposes that by 2030, the traditional Chinese medicine industry will establish a coordinated development system across the entire industry chain, and the stability of the supply of key traditional Chinese medicine raw materials will be further enhanced. 2. Chemical industry concept surges across the board Concepts related to dyes, epoxypropane, chemical raw materials, and chemical fibers surged across the board, with Cangzhou Dahua, Hebei Jinniu Chemical Industry, Jiangsu Baichuan High-Tech New Materials, and Lily Group Co., Ltd. hitting the limit up. Analysis: China Post Securities pointed out that the core reason for the recent rise in dispersed dye prices comes from the soaring prices of upstream key intermediate reductants. Reductants are important raw materials for dispersed dyes, and their prices have risen significantly from 25,000 yuan/ton last year to 38,000 yuan/ton, an increase of over 50%. 3. Active performance of the power equipment concept Power equipment, transformers, and other electricity concepts rebounded, with Jinneng Holding Shanxi Electric Power, San Bian Science & Technology hitting the limit up, and Beijing SOJO Electric, Baoding Tianwei Baobian Electric, Jiangsu Ankura Intelligent Electric following suit. Analysis: On the news front, according to reports from CCTV Finance, it was found during investigations in Guangdong and Jiangsu that many transformer factories are already operating at full capacity. Institutional views: Looking ahead, CICC believes that in terms of Chinese stocks, there is currently no typical signal of a peak in a bull market, and positive factors such as abundant liquidity and marginal improvement in performance have not undergone substantial changes. They continue to be optimistic about the revaluation process of Chinese assets, maintain an overweight recommendation for Chinese stocks, and suggest buying on dips during market fluctuations. CICC: Continues to be optimistic about the revaluation process of Chinese assets The impact of "Wash" also spreads to Chinese stocks and commodities. In terms of Chinese stocks, there is currently no typical signal of a peak in a bull market, with abundant liquidity and marginal improvement in performance unchanged; in the medium to long term, the reconstruction of the monetary order and the trend of the AI industry remain the core driving forces of the market. They continue to be optimistic about the revaluation process of Chinese assets, maintain an overweight recommendation for Chinese stocks, and suggest buying on dips during market fluctuations. Tianfeng: Fragile market sentiment, profit-taking by short-term investors or the main reason for the sharp decline in gold Tianfeng Research analysis: market sentiment has become fragile due to the rapid rise in gold prices in the previous period, and any change in news could trigger concentrated selling by short-term speculators. The nomination of Wash may bring about "hawkish" expectations, which could be the catalyst for a sharp decline in gold, but with fragile market sentiment, profit-taking by short-term investors is the main reason for the sharp decline in gold. In the short term, gold may enter a period of wide-ranging volatility, but there is still a chance for a rebound within the year. Huachuang Securities: The consumer market during the 2026 Spring Festival is expected to experience a strong recovery, and consumer data may exceed market expectations Huachuang Securities stated that through the analysis of various Spring Festival consumer promotion activities across the country, it is observed that this round of activities shows the distinct features of being "government-led, multifaceted, and comprehensive," with the core being the deep integration of diverse formats such as commerce, culture, tourism, sports, exhibitions, etc., through the dual-drive of "policy + activities," aiming to stimulate consumption potential, optimize consumption supply, and create a festive atmosphere. With strong policy support and a rich supply of activities, the consumer market during the 2026 Spring Festival is expected to experience a strong recovery, and consumer data may exceed market expectations, laying a solid foundation for the continued recovery of the consumer market throughout the year. It is recommended to actively focus on leading companies in the catering, hotel, tourism, duty-free, and commercial retail sectors benefiting from innovative consumption scenarios and the resurgence of consumer enthusiasm among residents. This article was originally published on "Tencent Self-selected Stocks", edited by Huang Xiaodong for GMTEight.