In the afternoon session today, A-shares staged a dramatic reversal. In early trading, the Shanghai Composite Index opened lower and drifted down, at one point falling below the 3,600-point mark. The ChiNext Index dropped more than 3% during intraday trading, with computing hardware, semiconductors, and related sectors leading the declines.
However, less than 10 minutes after the afternoon session opened, the situation reversed abruptly: the ChiNext Index quickly surged from a 3% loss to positive territory, the Shenzhen Component Index and CSI 300 rebounded in tandem, and the Shanghai Composite's decline narrowed substantially. By the close, all three major indices had turned positive. Specifically, the Shanghai Composite Index rose 0.89%, the Shenzhen Component Index gained 2.79%, and the ChiNext Index climbed as much as 4.16%. Market breadth shifted from a weak pattern in the morning, when more than 4,000 stocks declined, to a broad rally in which over 4,000 stocks advanced, signaling a notable recovery in market sentiment.
Positive news emerged around midday: Zhongji Innolight Co., Ltd. (SZSE: 300308), Eoptolink Technology Inc., Ltd. (SZSE: 300502), Suzhou TFC Optical Communication Co., Ltd. (SZSE: 300394), and Accelink Technologies Co., Ltd. (SZSE: 002281) collectively issued announcements, either disclosing progress on share buybacks or emphasizing full order books and normal operations. This rare "midday statement" quickly stabilized market sentiment, and the optical module sector was the first to rally.
Zhongji Innolight Co., Ltd. (SZSE: 300308) surged from an early loss of more than 6%, while Eoptolink Technology Inc., Ltd. (SZSE: 300502) recovered from a drop of over 8% to turn positive, driving the AI hardware segment to halt its decline and rebound.
At the same time, broad-based ETFs once again became an important channel for capital inflows. Net inflows into CSI 300 ETFs climbed rapidly in a short period during the afternoon, with several broad-based ETFs tracking the SSE 50, STAR 50, and CSI 1000 also seeing synchronized volume increases. The market interpreted this as "mysterious capital" once again stepping in to support the market.
As the largest weighted stock on the ChiNext, Contemporary Amperex Technology Co., Limited (SZSE: 300750) surged more than 5% in the afternoon, with turnover reaching 19 billion yuan, contributing significantly to the index's turnaround into positive territory.
Sun Feng, a financial derivatives analyst at Galaxy Futures, said the market on Friday displayed three major characteristics: first, trading volume in broad-based ETFs such as those tracking the CSI 300 continued to expand, providing sustained liquidity and effective support for the market; second, leading companies showed strong performance, serving as market bellwethers and helping boost market confidence; third, new market hotspots emerged, with physical AI driving notable gains in segments such as robotics, which is expected to become a near-term hotspot, creating a wealth effect and lifting market sentiment. Therefore, the rebound in the future can still be viewed with optimism.
Shenyin & Wanguo Futures stated that rising long-end U.S. Treasury yields have directly raised the pricing benchmark for global equity assets. High-valuation growth assets are extremely sensitive to interest rate changes, and an upward shift in the discount rate directly compresses the valuation space for growth sectors. Recently, volatility has significantly increased in previously crowded trades such as the U.S. AI supply chain and domestic hard tech sectors, with capital actively migrating toward high-dividend, dividend-focused assets with near-term cash flow characteristics for safety. The current market remains highly volatile, and short-term investors still need to wait for clearer stabilization signals.
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