Stock Market Midday Report | ChiNext Hits a 11-year High! Seven Major A-share Giants Show Unusual Activity, Market Structure Suddenly Presents Three Major Variables

On April 22nd, the three major A-share indexes opened lower and rose in early trading, shaking and rising. The Shenzhen Component Index continued to hit a new high, and the ChiNext Index hit an 11-year high! By midday, the Shanghai Composite Index rose by 0.24%, the Shenzhen Component Index rose by 0.63%, and the ChiNext Index rose by 0.63%. The turnover of the Shanghai and Shenzhen stock markets in the morning session was 1.58 trillion yuan, an increase of 107 billion yuan from the previous trading day. It is worth noting that according to Securities Times, on Wednesday morning, Zijin Mining Group and Contemporary Amperex Technology both showed signs of profit-taking. Industrial and Commercial Bank of China, China Construction Bank Corporation, Agricultural Bank Of China, Bank Of China, and China Mobile Limited also collectively retreated. It may still be difficult to understand the reasons for the retracement based on the performance of a single day. Among the 7 stocks mentioned above, 5 of them recently hit historical highs in the Hong Kong stock market, namely Contemporary Amperex Technology, Bank Of China, Industrial and Commercial Bank of China, Agricultural Bank Of China, and China Construction Bank Corporation. These stocks also saw a significant drop in the Hong Kong stock market this morning. Analysts believe that the retracement of large stocks has to some extent suppressed the performance of the stock indexes and may be a precursor to the outbreak of risk. In addition, recently, some phenomena have appeared in the A-share market: first, there are not many trading days with effectively enlarged turnover; second, the rate of return for chasing higher prices has significantly decreased; third, under the background of intensified game of existing shares, the phenomenon of "good news not reflected in stock prices" has increased. Analysts believe that the current market also faces three major uncertainties: first, before the "May Day" long holiday, the market needs to deleverage; second, there is still uncertainty in the Middle East situation; third, the impact of the "Wash Trade" on the market may increase after "May Day". Regarding the market situation, CPO concept again strengthened, with companies like Suzhou Dongshan Precision Manufacturing and Suzhou Everbright Photonics hitting historical highs. The sodium ion battery concept also became active again, with Tongxing Environmental Protection Technology hitting its daily limit for the second consecutive day, and several other stocks hitting their limits. The fiber optic concept also became active again, with Jiangsu Etern hitting its limit and continuing to hit historical highs. The metal indium concept surged rapidly, with companies like Zhuzhou Smelter Group and Yunnan Lincang Xinyuan Germanium Industry hitting continuous limits and historical highs. In terms of decline, the film and television theater concept collectively adjusted, with companies like Beijing Enlight Media and Bona Film Group experiencing decline. Additionally, airline and banking stocks saw larger decline. Looking ahead, Zhongtai stated that in the medium term, the A-share market does not have significant systemic downside risks, but the probability of a "fast bull market" is low. They recommended "controlling position, prioritizing structure." Popular sectors included the strengthening of the CPO concept, the resurgence of the fiber optic and fiber communication concepts, and the activity in the sodium ion battery concept. In terms of institutional views, Huang Yanming, the Director of the Orient Research Institute, mentioned that the "dumbbell" market trend of last year has ended, and the future investment opportunities in the A-share market are not at the extremes but in mid-cap blue-chips. In closing, the future of the A-share market is seen as optimistic by analysts, with a potential for new highs and a focus on mid-cap blue-chip companies.