The three major A-share indices opened with mixed results on June 25th. Early trading saw divergent performance, with the Shanghai Composite Index fluctuating narrowly, while the Shenzhen market initially surged before retreating, briefly turning the ChiNext Index negative. A rally in brokerage stocks before midday spurred a joint advance in both markets. In the afternoon, the indices diverged again; the Shanghai Composite turned negative at one point, while the Shenzhen market trended upward.
From a sector perspective, semiconductors and the AI hardware supply chain continued their strong performance, with memory and GPU segments leading gains. Lab-grown diamonds and optical chips also saw afternoon surges. Brokerages, building materials, and aviation sectors showed strength. In contrast, gold, oil and gas, chemicals, coal, and non-ferrous metals sectors weakened.
At the close, the Shanghai Composite Index was up 0.23% at 4,120.28 points. The Shenzhen Component Index rose 1.82% to 16,344.08 points, and the ChiNext Index surged 2.84% to 4,371.99 points.
Wind data shows that 1,231 stocks across the two main boards and the Beijing Stock Exchange rose, while 4,225 fell, and 70 were unchanged.
Total trading volume for the Shanghai and Shenzhen markets reached 3,594.3 billion yuan, an increase of 310 billion yuan from the previous session's 3,284.3 billion yuan. Specifically, Shanghai's volume was 1,619.0 billion yuan, up 104.8 billion from 1,514.2 billion, and Shenzhen's volume was 1,975.3 billion yuan.
According to DZH VIP data, 142 stocks across the two main boards and the Beijing Stock Exchange rose by 9% or more, while 54 fell by 9% or more.
Electronics Sector Continues Limit-Up Frenzy, Oil & Petrochemicals Plunge
Regarding sector performance, semiconductors remained strong, with the electronics sector continuing its surge of stocks hitting their daily limit-up. Talon Precision Machinery Co., Ltd (SZSE: 300650), Shihua Technology Co., Ltd (SSE: 688093), Ingenic Semiconductor Co., Ltd (SZSE: 300223), Advanced Micro-Fabrication Equipment Inc (SSE: 688380), Dioo Microcircuits Co., Ltd (SSE: 688381), and Huineng Technology Co., Ltd (SSE: 688403) were among over 30 stocks that hit limit-up or gained over 10%.
Building materials continued their advance, with Fashilong Building Materials Co., Ltd (SSE: 605318) and SINOMA Science & Technology Co., Ltd (SZSE: 002080) hitting limit-up. Jianfeng Group Co., Ltd (SSE: 600668), China Jushi Co., Ltd (SSE: 600176), and Kibing Group (SSE: 601636) gained over 9%.
Strength in brokerage stocks propelled the non-bank financial sector to the top of the gainers list. Changjiang Securities Co., Ltd (SZSE: 000783) hit limit-up, while Cinda Securities Co., Ltd (SSE: 600906) and China Securities Co., Ltd (SSE: 601066) rose over 6%. Founder Securities Co., Ltd (SSE: 601901), East Money Information Co., Ltd (SZSE: 300059), and T.F. Securities Co., Ltd (SSE: 601162) gained over 4%.
A decline in international oil prices led to a significant drop in the oil and petrochemicals sector. Xinchao Energy Corp (SSE: 600777) fell over 8%. Zhongman Petroleum & Natural Gas Group Corp., Ltd (SSE: 603619), Wanbangda Water Group Co., Ltd (SZSE: 300055), Tongyi Oil Co., Ltd (SSE: 600506), and CNOOC Ltd (SSE: 600938) declined over 5%. Zhejiang Rongsheng Holding Group Co., Ltd (SZSE: 002493) and Yuxin Energy Co., Ltd (SZSE: 002986) fell over 3%.
Non-ferrous metals were also among the top decliners. Jinchengxin Mining Co., Ltd (SSE: 603979), Yitong New Material Co., Ltd (SZSE: 300930), and Tibet Summit Resources Co., Ltd (SSE: 600338) dropped over 8%. Fuda Alloy Group Co., Ltd (SSE: 603045), Guocheng Mining Co., Ltd (SZSE: 000688), Shengtun Mining Group Co., Ltd (SSE: 600711), Xingye Silver & Tin Co., Ltd (SZSE: 000426), and Zijin Mining Group Co., Ltd (SSE: 601899) fell over 6%.
The utilities sector performed poorly. Dalian Thermal Power Co., Ltd (SSE: 600719) and Shuifa Energas Gas Co., Ltd (SSE: 603318) hit limit-down. Henan Yueneng Holding Co., Ltd (SZSE: 001896) briefly hit limit-down. Hunan Development Group Co., Ltd (SZSE: 000722), Yunnan Energy Investment Co., Ltd (SZSE: 002053), Sichuan Guang'an Ai Zhong Co., Ltd (SSE: 600979), Xichang Electric Power Co., Ltd (SSE: 600505), and Jovo Energy Co., Ltd (SSE: 605090) all declined over 5%.
Market's Structural Divergence Persists
Oriental Securities noted that the technology sector remains the primary investment choice recently. However, it cautions that the market is about to enter the mid-year earnings verification period, and investors should be wary of potential earnings shocks for many technology stocks that have been heavily speculated on. From a technical perspective, the Shanghai Composite has been trading within a relatively standard upward channel since its rebound from the low on the 8th of this month. Monday's sharp rally peak exceeded the upper channel line, leading to a pullback on Tuesday. Wednesday's low near 4,070 points, which roughly touched the lower channel line, triggered a rebound, but the index was clearly suppressed by the 5-day moving average. This level is roughly in the middle of the upward channel. The firm expects the index to retain momentum for a short-term test of the 4,150-point area.
Caixin Securities stated that the market's structural divergence continues, with a broad recovery in the hard tech sector driving the indices higher, while lithium mining and core chemical stocks were also active. Overall, the market has seen a timely recovery, making a sharp short-term downtrend less likely. However, structurally, the technology innovation sector shows a better overall trend, particularly in its ability to drive market sentiment against the tide during weak periods. The cyclical sector exhibits greater volatility overall, with the rally logic for some cyclical stocks also tied to the AI industry chain. Therefore, within the rotation, the technology innovation sector may warrant greater attention. Regarding operations, given lingering uncertainties in overseas markets and the need for the A-share market to digest certain positions at current levels, the index may experience a process of repeated fluctuations. It is advisable to take profits on rallies and grasp the rotation between styles. Although the market is currently in a phase of style rebalancing, medium-term pricing logic for A-shares will ultimately return to fundamentals and earnings drivers.
Tianfu Securities pointed out that the margin financing and securities lending balance has reached a historical high above 3 trillion yuan. Similar to trading volume thresholds, when the margin balance reaches historical highs, subsequent market movements often face corresponding disturbances. Although the absolute number is at a historical level, a closer look at its structure reveals two relative data points worth noting. First, the overall proportion of the margin balance to total market trading volume is lower than historical peaks. Second, within the margin balance, electronics, communications, and non-ferrous metals rank in the top three. This indicates that the market's extreme structural concentration is also fueled by this aggressive capital, which also serves as evidence of high market activity. However, once the corresponding concentrated positions loosen, this capital could also be a precursor to an emotional sell-off. Strategically, continue to monitor external market influences and changes in trading volume, paying attention to the impact of Micron Technology's earnings report data on global tech growth sentiment. As June concludes, the market faces a window for earnings verification and expectations of liquidity contraction. The market's pricing focus will shift from narratives to earnings realization, with a focus on assets with strong risk resistance, especially sub-sectors with high certainty in mid-year performance.
Guosen Securities indicated that since the start of this bull market, some technology sectors have performed brilliantly, with market structure divergence intensifying further since late March. Recently, some long-dormant value sectors have begun to perform. Looking ahead, referencing historical experiences of sector rotation during bull markets, current market conditions may be ripe for such rotation. Technology and growth remain the main theme, but the rally within the tech sector may broaden, potentially spreading from upstream computing infrastructure to application and energy segments. Within the growth theme, directions driven by industrial transformation like commercial aerospace and innovative drugs also deserve attention. Strategic resource commodities may benefit from supply constraints and rigid demand pushing up price centers, influencing their allocation logic over the medium to long term. Looking forward, against the backdrop of continued proactive policies to expand domestic demand, consumption sectors like real estate and baijiu (distilled spirits) may have catch-up opportunities. The third stage of a bull market often sees amplified trading volume, and previously underperforming but profit-improving brokerages may be worth watching.
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