On June 15th, the three major mainland stock indices experienced a rebound, with the Shanghai Composite Index gaining over 1% and the ChiNext Index surging more than 5%. Trading volume for the two markets shrank to 3.05 trillion yuan compared to last Friday.
The dramatic reversal in US-Iran tensions over the weekend boosted market risk appetite. After initially threatening large-scale airstrikes, President Trump called off the plan and announced on June 14th that a US-Iran deal was "now complete." This development led to a retreat in crude oil prices, reflecting a temporary reduction in geopolitical risk. However, the supply gap caused by the months-long blockade of the Strait of Hormuz persists.
May's US CPI data indicated overall hot inflation, but core inflation remained weak. This suggests the current inflationary cycle is primarily driven by external supply-side shocks rather than overheating domestic demand. If the Strait of Hormuz resumes normal operations, leading to a sustained decline in oil prices, the risk of energy-driven inflation acceleration would substantially decrease. Consequently, expectations for a Federal Reserve rate hike within the year could be revised downward. Market participants should monitor the signing of the US-Iran memorandum, the Fed's statements during its June 16-17 policy meeting, and the updated "dot plot."
Key Developments
On June 14-15 local time, Iran's Supreme National Security Council announced that the US and Iran had finalized the text of a memorandum of understanding on "ending war negotiations." All frontline warfare and military operations were to cease "immediately and permanently" from the evening of the 14th, with the maritime blockade against Iran to be fully lifted. US President Trump confirmed on social media that the agreement was "now complete," stating the Strait of Hormuz would be opened and authorizing the lifting of the US naval blockade on Iranian ports. A formal signing ceremony is scheduled for June 19 in Switzerland.
Analysis: A potential US-Iran peace deal would mark a significant turning point in the Middle East conflict that has lasted for months. The geopolitical premium on international oil prices would likely see a notable decline. This could substantially ease cost pressures for downstream manufacturing sectors like aviation, shipping, and chemicals. Conversely, the oil and gas extraction sector may face short-term adjustment pressures. A cooling of geopolitical risks would help stabilize global risk appetite, creating a more favorable external environment for the A-share market. Subsequent focus should be on the formal signing and implementation of the agreement, as well as progress in follow-up negotiations on Iran's nuclear program.
On June 12, the People's Bank of China released its financial statistics report for May 2026. The data showed the stock of aggregate financing to the real economy grew 7.7% year-on-year at the end of May, a 0.1 percentage point deceleration from the previous month. New yuan loans in May amounted to 520 billion yuan, 100 billion yuan less than the same period last year, with the loan balance growth rate falling to a historical low of 5.5%. The M2 money supply grew 8.6% year-on-year at the end of May, unchanged from the prior month. M1 growth was 5.5%, up 0.5 percentage points from April, narrowing the M2-M1 growth gap to 3.1 percentage points.
Analysis: The May financial data indicates continued obstacles in the transmission from "loose monetary policy" to "broad credit." Credit expansion relied on bill financing, while medium- and long-term corporate loans remained negative for two consecutive months, reflecting persistently weak real economy investment and financing demand. The trend of household "deleveraging" continued, with the recovery in property sales not yet effectively translating into mortgage demand. A structural bright spot was the continued expansion of direct financing, with funding for technological innovation remaining resilient, aligning with policy directions to foster new quality productive forces. Looking ahead, a substantial improvement in household and corporate financing willingness may still require further strengthening of domestic demand policies.
On June 15, the "Implementation Regulations of the Mineral Resources Law of the People's Republic of China" officially took effect. The regulations explicitly list 36 minerals, including tungsten, molybdenum, rare earths, germanium, gallium, and tantalum, in the strategic mineral resources catalog, subjecting them to special, whole-chain controls. Core measures include tighter mining quotas (making over-quota extraction illegal), stricter export approvals, and priority bidding for new mining rights. The regulations also establish a trinity strategic mineral reserve system encompassing product reserves, production capacity reserves, and resource deposit reserves.
Analysis: The formal implementation of these regulations marks a new stage of legalized, whole-chain management for China's strategic mineral resources. Placing 36 strategic metals under national-level control through the combined measures of tighter mining quotas, stricter export approvals, and priority bidding for new rights aims to safeguard the security of key industrial and supply chains. Expectations of supply-side contraction are likely to support the price floors for strategic metals like tungsten, rare earths, germanium, and gallium. In the medium to long term, underpinned by policy support and demand expansion from sectors like new energy and semiconductors, the valuation logic for the strategic metals sector may shift from cyclical to growth-oriented.
Market Performance
On June 15, the three major A-share indices closed higher. The Shanghai Composite Index closed at 4096.47 points, up 1.61%. The Shenzhen Component Index closed at 15531.01 points, up 3.79%. The ChiNext Index closed at 4033.53 points, surging 5.30%. The STAR 100 Index closed at 1989.25 points, up 5.16%. Among Shenwan primary industries, Electronics, Communications, and Building Materials led the gains, rising 6.58%, 6.50%, and 5.00% respectively. Coal, Banking, and Food & Beverage were among the decliners, falling 4.60%, 1.60%, and 0.90% respectively. 3906 stocks advanced while 1475 declined.
Capital Flows
Market turnover was 3050.925 billion yuan, lower than the previous trading day. The balance of margin trading and securities lending stood at 2873.482 billion yuan as of last Friday, also down from the prior session.
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