A-shares saw a significant rally on May 11, 2026, with the three major indices closing higher. The Shanghai Composite Index broke through the 4,200-point barrier, and the ChiNext Index surged over 3%, both reaching their highest levels in nearly 11 years. The total market turnover for the day exceeded 3.5 trillion yuan, hitting a four-month high.
Yang Delong, Chief Economist at Qianhai Kaiyuan Fund, stated that the A-share market appears to be entering a phase of accelerated upward movement. The market's positive returns are attracting more investors to allocate funds to A-shares or related funds, potentially accelerating the shift of household savings into the capital markets. This trend is expected to further enhance market returns.
Xia Fanjie, Investment Strategy Analyst at China Securities Co., Ltd., noted that in the long term, against the backdrop of a gradual erosion of U.S. dollar credibility and global capital seeking new anchors, the premium for the renminbi's stability and the revaluation of Chinese assets may just be beginning. He suggested that A-shares are transitioning from a valuation-driven phase to an earnings-driven phase, entering the latter half of the bull market.
Daily Turnover Exceeds 3.5 Trillion Yuan On May 11, the three major A-share indices opened higher and continued to strengthen throughout the day, with overall market sentiment remaining optimistic.
At the close, the Shanghai Composite Index rose 1.08% to 4,225.02 points, the Shenzhen Component Index gained 2.16% to 15,899.3 points, and the ChiNext Index surged 3.5% to 3,928.97 points. Additionally, the CSI 300 Index increased by 1.64%, while the Beijing Stock Exchange 50 Index fell 0.7%. The STAR 50 Index rose 4.65%.
Notably, the Shanghai Composite Index reached its highest level since early July 2015, the Shenzhen Component Index hit a high since mid-February 2021, the ChiNext Index achieved a peak since early June 2015, the CSI 300 Index climbed to its highest since early January 2022, and the STAR 50 Index set a new all-time high.
The total turnover for A-shares was approximately 3.57 trillion yuan, a significant increase of about 490 billion yuan from the previous day. This marked the fourth consecutive trading day with turnover exceeding 3 trillion yuan and represented the highest single-day turnover in nearly four months.
In terms of sector performance, most of the 31 primary Shenwan industry sectors closed higher. The electronics, communications, and machinery equipment sectors led the gains, rising 4.73%, 3.28%, and 2.15%, respectively. The transportation, media, and beauty care sectors were among the decliners, falling 0.91%, 0.8%, and 0.58%, respectively.
From the perspective of main fund flows, the top three sectors with net inflows were semiconductors, securities, and components, with net inflows of 91.22 billion yuan, 32.21 billion yuan, and 30.31 billion yuan, respectively. The top three sectors with net outflows were batteries, IT services, and auto parts, with net outflows of 55.86 billion yuan, 52.85 billion yuan, and 33.69 billion yuan, respectively.
At the individual stock level, 3,121 stocks advanced across the market, with 135 hitting the daily limit-up. Meanwhile, 2,239 stocks declined, with 27 falling to the daily limit-down.
On the macroeconomic front, U.S. President Donald Trump is scheduled to pay a state visit to China from May 13 to 15. The leaders of the two countries are expected to engage in in-depth discussions on major issues concerning China-U.S. relations as well as global peace and development. This meeting marks the second face-to-face interaction between the two leaders since their talks in Busan last October and is the first visit by a U.S. President to China in nine years.
In early November 2017, during his first state visit to China after taking office, President Trump oversaw the signing of 34 cooperation projects between Chinese and American companies, with a total value of $253.5 billion, achieving substantial commercial outcomes.
Yang Delong analyzed that President Trump's upcoming visit to China suggests a potential easing of tensions between the two nations, which could release more positive signals.
Institutions Predict Continuation of Slow Bull Market Recently, as markets have gradually digested the impact of external events such as the U.S.-Iran conflict, stock markets in multiple countries have seen significant rallies. Markets in the U.S., Japan, South Korea, and others have frequently hit record highs, while the A-share market has also reached an 11-year peak. Looking ahead, how much further upside potential does this bull market have?
Xia Fanjie pointed out that the bull market in A-shares is expected to continue in the second half of 2026. In terms of market rhythm and characteristics, the latter half of a bull market typically faces challenges in driving valuation expansion. The pace of gains for the broader A-share index may slow, exhibiting characteristics of structural differentiation. It is anticipated that A-shares will experience a structural slow bull market, driven by sector-specific prosperity and concentrated fund flows. Investors are advised to follow an investment strategy centered on "prosperity as the guiding principle," focusing on two main themes: the "computing power boom" and the "recovery boom."
He also believes that the narrative around AI is shifting from concentrated holdings in core sectors to a broader diffusion of prosperity across the entire industry chain. Reviewing the shifts in main themes during four typical bull markets since 2005, the current AI computing power theme is far from entering a phase of widespread speculation. The market trend is unlikely to retreat from the technology sector simply due to overheated valuations. Instead, against the backdrop of continued validation of industry trends, prosperity is expected to diffuse along the industrial chain based on three logics: supply shortages and price increases, exploration of new demand, and capacity constraints. Key areas to watch include optical modules, PCBs, electronic fabric/CCL, advanced packaging, CPUs, memory chips, liquid cooling, data center power supply, computing power leasing, and cloud services.
Qiu Hua, an analyst at Xiangcai Securities, stated that from a long-term perspective, 2026 marks the beginning of China's 15th Five-Year Plan period. The country is expected to maintain proactive fiscal policies and appropriately accommodative monetary policies, providing crucial support for stable domestic economic operations and a sustained "slow bull" trend in the A-share market.
From a short-term perspective, as tensions between the U.S.-Israel and Iran in the Middle East gradually ease and domestic macroeconomic data for the first quarter remains positive, A-shares are expected to continue their upward trajectory in May. Recommendations include focusing on left-leaning sectors such as banking, securities, and services, as well as right-leaning sectors with clear investment logic in cyclical areas like high-end equipment. Within the AI technology sector, attention should be paid to chip manufacturing and related fields with confirmed earnings performance.
A well-known private equity firm, Xing Shi Investment, indicated that both the U.S. and Iran currently appear intent on keeping their conflict within controllable limits. The most intense phase of the Middle East conflict has likely passed, and a shock similar to that seen in March is unlikely to recur. Coupled with President Trump's upcoming visit to China, market sentiment is expected to continue recovering, with investment logic shifting back to economic fundamentals, industry trends, and corporate earnings.
In the medium term, the recovery of listed companies' earnings is expected to be a key driver for the stock market in the next phase. The profitability of high-growth trend industries has already been validated. As China's nominal GDP growth picks up, the recovery in corporate profitability is anticipated to spread to a broader range of industries, potentially strengthening the fundamental drivers of the A-share market.
Comments