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full of emotions!

in early trading today, the a-share market completely ignored the sharp decline in the asia-pacific market in early trading and opened higher across the board. as of press time, the chinext index rose by more than 9%, the shanghai stock exchange index rose by 5.72%, and the shenzhen component index rose by 7.31%. according to reports from china securities journal, the scheduled transfers of securities firms were fully booked yesterday. in early trading this morning, there was news from banks that the bank-securities transfer system collapsed, and the bank-securities systems of major state-owned banks were extremely busy.

shortly after the opening of trading, the transaction volume of the shanghai and shenzhen stock markets quickly exceeded 500 billion yuan, and the volume exceeded 200 billion yuan compared with the previous trading day.

from the perspective of leveraged funds, the entry into the market is also accelerating. as of september 27, the financing balance of the shanghai stock exchange was 722.622 billion yuan, an increase of 5.782 billion yuan from the previous trading day; the financing balance of the shenzhen stock exchange was 661.082 billion yuan, an increase of 12.708 billion yuan from the previous trading day; the two cities totaled 1.38 trillion yuan , an increase of 18.490 billion yuan compared with the previous trading day.

running entrance

in early trading today, the a-share market was booming again. against the background of the sharp decline in the japanese stock market, the ftse china a50 index futures rose rapidly during the day and are now up more than 2.5%. at the same time, the hang seng index opened 2.63% higher, and the hang seng technology index rose 4.38%. as of press time, the hang seng technology index has expanded to 5%. nio rose nearly 15%, bilibili rose more than 12%, and xpeng motors, meituan, and oriental selection rose more than 7%. apparently, chinese assets were completely unaffected by the japanese market.

at the same time, according to the china securities journal, a brokerage firm’s scheduled transfers were fully booked yesterday. in early trading this morning, there was news from a bank that the bank-securities transfer system had collapsed, and the bank-securities system of a major state-owned bank was extremely busy. a large amount of money is rushing in.

it is worth noting that as of september 27, the financing balance of the shanghai stock exchange was 722.622 billion yuan, an increase of 5.782 billion yuan from the previous trading day; the financing balance of the shenzhen stock exchange was 661.082 billion yuan, an increase of 12.708 billion yuan from the previous trading day; the two cities the total amount was 1.38 trillion yuan, an increase of 18.490 billion yuan from the previous trading day.

china's stock market boom and policy stimulus measures have also pushed up international commodity prices, but in addition to the pressure on oil due to saudi arabia's production increase plan, the prices of industrial metals such as copper, aluminum and zinc - key materials for china's manufacturing industry - have risen sharply. . prices of copper, widely used in construction, have risen more than 5% since tuesday, topping $10,000 a ton and hitting their highest level in three months. iron ore prices recently fell to a two-year low due to weak steel demand, but are now rebounding. in early trading today, the most active singapore november iron ore contract rose 10.6% to us$113/ton. the main domestic glass contract hit the daily limit, up 10.07%, to 1,290 yuan/ton. the main soda ash contract hit its daily limit, rising 10.04% to 1,721 yuan/ton. this suggests a possible shift in market sentiment.

in addition, on september 30, the national bureau of statistics released data showing that in september, the manufacturing purchasing managers index (pmi) was 49.8%, an increase of 0.7 percentage points from the previous month, indicating that the prosperity of the manufacturing industry has rebounded. in september, the non-manufacturing business activity index was 50.0%, down 0.3 percentage points from the previous month, and the non-manufacturing business boom level fell slightly. in september, the comprehensive pmi output index was 50.4%, an increase of 0.3 percentage points from the previous month, indicating that the overall expansion of production and operation activities of chinese enterprises has accelerated.

enthusiasm is rising overseas

options trading on exchange-traded funds (etfs) that track stocks in asian countries surged. bullish bets dominated, with some early call option buyers taking profits later in the week and others rolling positions through call spreads. short-term contracts for chinese companies' american depositary receipts (adrs) were trading bullishly.

mark franklin, senior portfolio manager of asset allocation at manulife investment management, said optimism is currently prevailing. since investors are very cautious in holding positions, a shares and h shares are expected to rise sharply in the short term, which may lead to a sharp rebound driven by short covering.

nicholas yeo, a china stock market director, pointed out that the federal reserve's recent interest rate cuts will provide more impetus. global easing policies are expected to stimulate consumption, benefiting china, the world's largest exporter. expectations that china will introduce further stimulus measures also drove gains in european stock markets, with the stoxx 600 index hitting a record high and luxury brands expected to benefit from increased consumer spending in china.

analysts such as bank of america's winnie wu noted that the rebound differed from previous policies in that the government encouraged leveraged investing, suggesting that the liquidity-driven rally could continue for a long time. david chao, global market strategist at invesco, compared the rebound to the stock market rally of 2014-2015, when the shanghai composite index rose 150%. he predicted that as the dollar cuts interest rates further, investors will shift from expensive global technology stocks to cheaper emerging market assets.

where is the height? how to participate?

guotai junan believes that stock prices are investors’ expectations for the future. loose financial policies and active politburo meetings imply objective analysis of the economic situation by policymakers and urgent changes in attitudes towards economic policies and capital markets. this is the stock market expectation. the key to improvement. the focus of understanding the logic of this round of stock market trends is not the substantial upward revision of economic expectations, but the decline in risk-free interest rates that promotes incremental capital inflows, as well as investors’ improved expectations for risk prospects and increased risk appetite expectations; trading characteristics are reflected in the optimists pricing drives up share prices. after a short-term rise, optimistic expectations for policies will still push up the stock market; with reference to the market height of the change in policy attitudes in 2019, there is still some room for upward growth in the valuation of the shanghai composite. heavyweight stocks are filling the pricing depression. after the transactions are amplified, the weight will set the stage for growth, and excess returns will be transferred to growth stocks.

huatai securities said that last week, the market formed a smooth offensive market due to the increasing policy levels. at this time, investors are more concerned about: first, how sustainable and highly anticipated the phased market is, and second, if further participate in the investment direction with better risk and return.

judging from the cross-validation of multiple signals, there are no obvious variables in the market. first, on the financial side, there is no divergence between going with the trend - going against the trend - leveraged funds; second, on the emotional side, the risk preference index rebounded rapidly but not to the extreme; third, on the historical law, the general trend after the bottom, the average market height and duration of the first stage of fundraising are greater than the current round. the current comprehensive internal and external environment is slightly better than that in may this year, but weaker than that in the first quarter of 2023. under the current policy combination, the market height can refer to the range formed at these two points. if you want to participate further, it is recommended to pay attention to the pharmaceutical/social service/real estate chain, etc. that are at low levels and need to make up for the increase.

chen guo of citic construction investment believes that if absolute gainers want to cash out completely at the top of the first wave, the requirements for capital and transaction levels are still quite high. they can spread out the steps and accept that at least part of them is slightly to the right. if you are not willing to chase, you can only wait for the second wave. the second wave will be slower and longer, and will be dominated by structural market conditions. and i believe there will be a third wave. the first wave is dominated by index heavy stocks, especially non-bank financial logic; the second wave is dominated by themes and some structural boom expected growth directions; the third wave is dominated by index heavy stocks, but it is more related to the economy, especially it is a procyclical sub-industry that exceeds expectations. the market conditions at this stage generally have nothing to do with non-bank finance.