the shanghai composite index regained the 3,000-point mark in three days. a-shares are so bullish. what will happen to the market outlook?
2024-09-28
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yangcheng evening news all-media reporter zhan shuzhen hu yan mo jinrong
driven by various favorable policies, the a-share market has continued to heat up in recent days. the shanghai composite index rebounded strongly from below 2,800 points and successfully regained the 3,000 point mark in just three days.
on september 27, the three major a-share stock indexes rose collectively, with more than 5,200 stocks in the market achieving gains. due to the intense trading volume, the shanghai stock exchange trading system experienced delays during the session. in response to this, the shanghai stock exchange responded quickly, stating that it "has noticed that after the opening of today's stock bidding transactions, the transaction confirmation was abnormally slow, and it has paid attention to it as soon as possible and started to investigate the cause." subsequently, the system gradually returned to normal and transactions resumed in an orderly manner.
how bullish is the stock market this week?
three consecutive trading days set records
recently, a number of favorable policies have been implemented intensively, injecting strong impetus into the a-share market. market sentiment subsequently increased, and investors increased their investment, pushing the market to continue rising.
wind data shows that on september 27, the market accelerated throughout the day to defeat short sellers. the shanghai index advanced to 3100 points, and the chinext index once rose 12% to create history. on the market, the market continued to be hot in the afternoon. after a brief fall, the chinext index continued to fluctuate at a high level and set a new historical record. wuliangye and vanke a rarely appeared on the list of consecutive boards, and citic securities and oriental fortune both reached their daily limit in late trading. over 5,200 shares traded red throughout the day.
as of the close of the day, the shanghai composite index, shenzhen stock exchange component index, and chinext index closed up 2.89%, 6.71%, and 10% respectively, reporting at 3087.53 points, 9514.86 points, and 1885.49 points respectively. a-share transactions totaled 1.46 trillion yuan throughout the day, exceeding 283.8 billion yuan compared with the previous trading day. it exceeded 1 trillion yuan for the third consecutive trading day and hit a three-year high.
not only was the single-day performance strong, but the overall performance of a-shares this week was equally impressive. this week, the shanghai stock exchange index rose 12.81%, the best weekly performance since november 2008; the shenzhen component index rose 17.83%; the chinext index rose 22.71%, and the weekly increase hit a record high.
how long can the rally last?
many institutions expressed optimism about the market outlook
such a strong performance of a shares has made many investors happy. on social media, some investors ridiculed, "it's too early for a-shares to close at 3 pm. isn't it too early to open for another two hours?" "can a-shares work overtime during the national day holiday? i don't want a holiday!"
investor sentiment is high, and the number of business inquiries from brokerage firms has also surged. many brokerages reported that the number of customers coming to consult for business has increased significantly recently, and some customers are even "busy to retrieve their account passwords."
investors are also discussing: how long can the stock market rise this time? as the market recovers across the board, many institutions have spoken out and are firmly optimistic about the market outlook.
everbright securities said that the shanghai stock exchange index has regained 3,000 points strongly, which has greatly increased market confidence, optimism has fermented and spread, and calls for a bull market are growing. however, considering the huge short-term gains in the index, the large number of profit-making orders, and the upcoming national day holiday, the market may have relapses in the future, but the upward trend remains unchanged.
cicc also analyzed that the politburo meeting further released signals of policy increases, and the rise of a-shares is expected to continue. since mid-to-late september, a-shares have stabilized and rebounded under the influence of favorable factors such as the external interest rate cut by the federal reserve and the positive signals released by the domestic national congress. on the one hand, the timing of this politburo meeting has attracted market attention. on the other hand, combined with the positive news disclosed by the national council of the people's republic of china, it has a clearer stance on policy responses that investors are more concerned about, especially fiscal policy, and has given greater attention to the capital market. high attention. cicc stated that this meeting has a positive impact on the market and is expected to further stabilize investor confidence. the a-share market is expected to continue its upward trend under the current environment.
what are the positive factors?
policy combination shows its power to boost the market
what are the main driving forces behind this strong rebound in the a-share market? industry analysts pointed out that at this stage, policy combination has become an important factor in driving the market upward. from cutting reserve requirements and interest rates to encouraging medium- and long-term funds to enter the market, a series of policies have been intensively introduced, which has played a positive role in economic fundamentals and the stock market.
on september 24, the people's bank of china, the state administration of financial supervision, and the china securities regulatory commission jointly launched a number of easing policies, including lowering the deposit reserve ratio, cutting interest rates, and adjusting existing mortgage interest rates. the central bank announced that starting from september 27, it will lower the deposit reserve ratio by 0.5 percentage points; the open market 7-day reverse repurchase operation interest rate will be lowered by 0.2 percentage points to 1.5%. in addition, the central financial office and the china securities regulatory commission jointly issued the "guiding opinions on promoting medium and long-term funds to enter the market", proposing to vigorously develop equity public funds and support the steady development of private securities investment funds.
"the policy released by the central bank on the 24th exceeded market expectations and can be said to be the most comprehensive easing policy since 2015. the overall easing intensity is greater than our forecast, and the comprehensive package of plans is obviously aimed at restoring market confidence." jp morgan china chief said zhu haibin, economist and director of economic research for greater china.
goldman sachs also pointed out in its latest strategy report that this round of easing policy shows that policymakers are paying attention to economic growth and the market, which is enough to catalyze a new round of policy rebound. the current conditions for a tactical market recovery similar to april 2024 are already in place. in addition, goldman sachs believes that compared with a-shares, hong kong stocks have stronger earnings revisions and recommends investors to invest tactically in chinese stocks.
in addition, american hedge fund legend david tepper expressed his bullish view on the chinese stock market in an interview on thursday. tepper believes that the federal reserve's interest rate cut last week will provide favorable conditions for china to relax its policy. even after the recent surge, chinese stocks still have plenty of room to rise. he said: "compared with the past, china-related assets are at a low point. and the current valuation is low, the price-to-earnings ratio is single digits, but the growth rate is double digits."
with the gradual implementation of easing policies, market confidence has further recovered, and quantitative easing monetary policies have also had a positive impact on the development of the stock market. however, industry insiders also reminded that investors should view the short-term rebound rationally and pay close attention to changes in macroeconomic fundamentals. in the coming period, it will be necessary to observe how the policy effects are transmitted to the real economy, including whether corporate profits increase, whether residents' spending power is enhanced, and whether there is a real net inflow of incremental funds. therefore, while enjoying short-term dividends, investors should also have a longer-term investment perspective and a sound strategic layout.
