Major A-share indices rose on March 18, with the ChiNext Index gaining more than 2%, while market turnover shrank further to 2.06 trillion yuan. Internationally, escalating Middle East conflicts coincided with a "super central bank week." The U.S. Federal Reserve is scheduled to announce its latest interest rate decision in the early hours of tomorrow, Beijing time, with markets widely expecting rates to remain unchanged. The focus will be on the updated Summary of Economic Projections (SEP) and the dot plot. Potential disruptions in the Strait of Hormuz could fuel inflation expectations, potentially reducing the likelihood of rate cuts within the year. This may strengthen the U.S. dollar and Treasury yields, increasing volatility in global risk assets. Domestically, economic indicators for January-February showed a solid start, with industrial value-added growth at 6.3%, fixed-asset investment turning positive, exports performing strongly, and moderate retail sales growth. These figures have alleviated previous concerns about the momentum of economic recovery. Detailed data reveals that equipment manufacturing contributed nearly 50% to industrial growth, and sectors aligned with "new quality productive forces" showed robust performance, indicating substantial optimization of China's economic structure. In the near term, domestic equity markets may experience fluctuations due to external uncertainties, suggesting a defensive strategy may be prudent. Clarity on the impact of U.S.-Iran tensions on oil prices is awaited, with subsequent attention on the recovery of the Producer Price Index (PPI) and changes in corporate earnings.
On March 17, the Ministry of Finance released its "Report on the Implementation of China's Fiscal Policy in 2025." The report reviewed fiscal operations for 2025: national general public budget expenditure reached 29.4 trillion yuan, up 3.6% year-on-year, while spending on science and technology amounted to 1.2062 trillion yuan, an increase of 4.8%. For 2026, the ministry stated it would continue to implement a more proactive fiscal policy, enhancing its precision and effectiveness. The report systematically introduced, for the first time, a package of policies for "fiscal-financial coordination to boost domestic demand," linking ultra-long-term special government bonds and special-purpose bonds with financial instruments. This aims to leverage government spending to stimulate private investment and household consumption. The 4.8% growth in tech spending and a 9.6% rise in basic research expenditure confirm a clear policy tilt towards "new quality productive forces." Sectors like technological innovation, high-end manufacturing, and new types of consumption are expected to continue receiving fiscal support.
On March 17, the National Development and Reform Commission (NDRC) announced a new batch of 13 landmark major foreign-invested projects, with a planned investment of $13.4 billion. The newly selected projects are primarily concentrated in manufacturing, including electronics, chemicals, automobiles, and electrical machinery, aimed at accelerating the development of industrial clusters. To date, landmark major foreign-invested projects have cumulatively completed investments of $108 billion, demonstrating significant demonstrative and catalytic effects in attracting foreign capital. Notably, this batch included logistics projects for the first time and continued support for R&D center projects in fields like biomedicine. This signals China's increased support for the service sector and its push for deep integration between modern services and advanced manufacturing. Investment sources have become more diverse, including multinational companies from the UK, Germany, Switzerland, Sweden, and Turkey. The focus on advanced manufacturing sectors such as electronics, chemicals, and automobiles aligns closely with the direction of domestic industrial upgrading, fostering a synergistic innovation ecosystem involving both Chinese and foreign enterprises.
From March 17 to 18, the NDRC, in collaboration with relevant departments, initiated the application process for nationally significant landmark application scenario projects. These projects will be published in a list, and qualifying ones will receive priority support through existing funding channels. It is reported that the NDRC will identify approximately 100 leading landmark scenario projects nationwide. These involve creating multi-provincial clean energy corridors, developing comprehensive unmanned system scenarios, and establishing elderly care service scenarios in regions with higher degrees of population aging. The launch of these 100 landmark application scenario projects signifies a profound shift in macro-policy orientation from "providing funds and incentives" to "providing markets and opportunities." For emerging industries like the low-altitude economy, clean energy, and elderly care services, the lack of real-world application scenarios to validate technologies often poses a greater challenge than funding shortages. By leading the opening of public resources and coordinating to resolve institutional barriers (such as opening low-altitude airspace and simplifying flight approvals), the government helps provide valuable platforms for testing and implementing new technologies. The policy arrangement for prioritized funding support is expected to boost investment confidence in these related fields.
On March 18, the three major A-share indices closed higher. The Shanghai Composite Index rose 0.32% to 4,062.98 points, the Shenzhen Component Index gained 1.05% to 14,187.98 points, the ChiNext Index advanced 2.02% to 3,346.37 points, and the STAR 100 Index increased 2.31% to 1,558.69 points. Among Shenwan's primary industries, Communications, Computers, and Electronics led the gains, rising 5.23%, 2.46%, and 2.41% respectively. In contrast, Petroleum & Petrochemicals, Real Estate, and Food & Beverage were among the top decliners, falling 1.47%, 1.05%, and 0.91% respectively. In the broader market, 3,473 stocks advanced while 1,682 declined.
Market turnover was 2,061.217 billion yuan, decreasing from the previous trading session. The balance of margin lending and short selling stood at 2,652.036 billion yuan as of the last close, also down from the prior day.
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