The three major A-share indices opened higher collectively on May 25. The markets climbed during morning trading amid fluctuations, then traded in a tight range near session highs in the afternoon before extending gains into the close.
Sector-wise, the semiconductor industry chain surged, while coal, aviation, and power sectors led the gains. Oil and gas, lithium battery, and photovoltaic sectors weakened.
By the close, the Shanghai Composite Index rose 0.96% to 4152.57 points; the Shenzhen Component Index gained 1.66% to 15856.61 points; and the ChiNext Index increased 2.1% to 4021.16 points.
Wind data shows 2,181 stocks advanced across the Shanghai, Shenzhen, and Beijing exchanges, while 3,218 declined, and 116 ended flat.
Total turnover for the two markets reached 3,205.8 billion yuan, an increase of 302.5 billion yuan from the previous session's 2,903.3 billion yuan. Specifically, Shanghai's turnover was 1,445.7 billion yuan, up 159.9 billion from the prior session, and Shenzhen's turnover was 1,760.1 billion yuan.
According to DZH VIP data, 179 stocks across the two markets and the Beijing Exchange rose by 9% or more, while 40 stocks fell by 9% or more.
Semiconductors Surge Again, Oil & Petrochemicals Lead Declines In sector performance, the semiconductor sector surged significantly once more. Stocks including Dongxin Semiconductor (688110), Huahong Semiconductor (688347), ACM Research Shanghai (688082), SMIC (688981), Dongwei Semiconductor (688261), and Fuxin Technology (688662) saw over 20 stocks hit limit-up or gain over 10%.
Coal stocks led the gains at one point during the session. Panjiang Coal & Electricity (600395) and Pingdingshan Coal (601666) rose by the daily limit. Huaibei Mining (600985), Lu'an Environmental Energy (601699), Haohua Energy (601101), and Xinji Energy (601918) gained over 5%.
Building materials remained strong throughout the day. Changhai Advanced Materials (300196), North Glass (002613), Honghe Technology (603256), and Youbang Ceilings (002718) rose by the limit or gained over 10%. Kailun New Materials (300715) and International Composite Materials (301526) advanced over 6%.
Oil and petrochemicals led the declines. Potential Energy (300191) and Tongyuan Petroleum (300164) fell over 9%. BOMESC Offshore Engineering (603727), RenZhi Shares (002629), Beken Energy (002828), and Zhongman Petroleum (603619) dropped over 5%.
Basic chemicals underperformed. Yayun Holdings (603790) and Do-Fluoride New Materials (002407) fell by the daily limit. Sinochem International (600500) declined over 9%. Baofeng Energy (600989), Huigu New Materials (301683), Zhongxin Fluoride Materials (002915), and Yongtai Technology (002326) lost over 6%.
Media stocks opened high but closed lower. Sanrenxing (605168) and Zhidu Technology (000676) fell by the daily limit. Xinghui Entertainment (300043), Xunyou Technology (300467), Zhide Mai (300785), and Youzu Interactive (002174) declined over 3%.
Market Bottom Range Holds Solid Support The current A-share market shows volatile differentiation with hard tech sectors leading gains. The market driver is shifting from expectations and liquidity to corporate earnings. Macroeconomic recovery remains weak, with a notable gap between domestic and external demand, a divergence between old and new growth drivers, and structurally rising inflation. At the meso level, industry prosperity is highly divergent. It is advised to focus on three main themes: 1) High-tech sectors with strong demand-supply tightness and high earnings growth, such as computing power and semiconductors; 2) Resilient exports, where advanced manufacturing benefits from global demand; 3) Sectors showing initial inflection points after capacity clearance, such as chemicals, industrial metals, power equipment, and marine equipment, where supply-demand improvements offer potential elasticity. A balanced allocation across these three themes is recommended, with particular attention to electronics, power equipment, machinery, defense, non-ferrous metals, and basic chemicals.
Since mid-May, the main resistance for A-shares has stemmed from two factors: overseas liquidity pressures and persistently crowded micro trading structures within the tech sector. Although non-tech sectors have repeatedly attempted to attract capital flows, they have consistently failed to become a consensus direction for funds due to the fundamental reality of weak domestic demand. The current adjustment is seen as a phase of consolidation within a strong structural market. Coupled with regulatory efforts to advance risk prevention and strengthen supervision, this helps digest overheated sentiment and lays a foundation for healthy, sustainable future gains. Examining from the perspectives of micro liquidity, global industry trends, and policy-driven expectation stabilization, the market's bottom range possesses solid support.
Regarding recent consecutive market adjustments, the core concern originates from crowded microstructures. Reviewing several historical periods of high crowding, deteriorating microstructure often corresponds to increased short-term market volatility but does not necessarily signal the end of a bull market. A more probable scenario is not a "tech retreat" but rather a rotation within the tech sector itself and a diffusion of the growth style toward more assets with "secondary ignition" potential. The current microstructure approaching a sensitive zone essentially acts as a catalyst for the bull market entering its third stage. The first stage buys recovery, the second stage buys re-rating, and the third stage buys ignition. Upon entering the third stage, the market no longer indiscriminately rewards high-beta assets but begins to screen for directions with genuine earnings realization and accelerating growth momentum. The core of "secondary ignition" assets lies in possessing both G (growth level) and ΔG (growth improvement slope). In other words, the market is gradually shifting from "buying recovery" to "buying growth and the rate of change in growth."
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