Market Analysis Inflation showed a month-on-month recovery. On the macroeconomic front, data released by the National Bureau of Statistics indicated that China's CPI rose 0.2% month-on-month and 0.2% year-on-year in January, while core CPI increased 0.8% year-on-year. The PPI climbed 0.4% month-on-month, marking the fourth consecutive month of growth, with the growth rate expanding by 0.2 percentage points from the previous month. Year-on-year, the PPI declined 1.4%, though the rate of decline narrowed by 0.5 percentage points. Overseas, the seasonally adjusted U.S. nonfarm payrolls for January performed strongly, adding 130,000 jobs in a single month, significantly surpassing market expectations of 70,000. The previous figure was slightly revised down from the initial reading to 48,000. The unemployment rate for the same period stood at 4.3%, hitting a new low since August 2025, while average hourly earnings grew 0.4% month-on-month. Despite the employment increase reaching the highest level in nearly a year and a half, growth momentum remained highly concentrated in a few sectors, with healthcare being the dominant contributor, adding 124,000 jobs in one month—double the sector's normal monthly average growth in 2025—highlighting the structural nature of the employment expansion.
Indexes Experienced Volatility. In the spot market, the three major A-share indexes fluctuated, with the Shanghai Composite Index rising 0.09% to close at 4,131.98 points, while the ChiNext Index fell 1.08%. Sector-wise, industry indexes were mixed, with building materials, nonferrous metals, and petroleum and petrochemicals leading the gains, while communications, media, and social services were among the top decliners. The market continued to see shrinking volume, with the daily turnover of the Shanghai and Shenzhen stock exchanges falling below 2 trillion yuan. Overseas, the three major U.S. stock indexes closed slightly lower, with the Nasdaq dropping 0.16% to 23,066.47 points.
IH Saw Increased Positions. In the futures market, basis differences for IC and IM rebounded, with near-month contracts trading at a premium. In terms of trading volume and open interest, both volume and open interest for IH and IM increased simultaneously.
Strategy The nonferrous metals sector rebounded during the session. As mentioned in yesterday's strategy, if the nonferrous metals sector stabilizes and recovers, it could drive further gains in the CSI 500 index. Sustainability should be monitored. From a broader market perspective, trading activity is expected to become more cautious ahead of the holiday, and a pattern of low-volume recovery is likely to persist.
Risks If domestic policy implementation falls short of expectations, overseas monetary policies exceed expectations, or geopolitical risks escalate, stock indexes could face downward pressure.
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