Anyone who watched US stocks last night (November 5) probably already guessed the outcome for A-shares today (November 6).
Although divergence appeared once again, recent days have already demonstrated a high degree of resilience and strength. Some say today's pullback was much gentler than expected. This round of decline is largely attributed to overseas factors such as the US stock market correction, but with global sentiment cooling, "Can A-shares stabilize going forward?" has become the core point of contention. From a cyclical perspective, uncertain factors facing A-shares still exist, but as internal叠加 positive factors continue to gain traction, the market may not be as pessimistic as imagined.
Don't Panic — A-Shares Still Have Opportunities
On November 6, major A-share indices opened collectively lower. Although there was volatility during the session, a certain sentiment recovery rally emerged. Overnight, the Nasdaq index fell 5.52%, and today the Korean index dropped nearly 9% at one point. Boosted by positive factors such as South Korea planning to relax margin rules during the stock market plunge, the Korean index saw some intraday recovery. Among major A-share indices, the ChiNext board saw the largest decline, exceeding 3%. In a simple comparison, A-shares have shown stronger resistance to declines. In any case, today's market has already absorbed existing negative factors to a large extent.
The A-share market previously benefited from the linkage of the global AI industry chain, ushering in a super rally. Now, if any single link in that chain runs into trouble, it will trigger a shift in global sentiment. Earlier adjustments in A-shares were more about correcting high valuations, while recent ones have been more dragged down by overseas events and US stock declines. Since the correlation between A-shares and US stocks will persist, let me briefly discuss US stocks here. Two core questions: First, what level of decline does this Nasdaq drop of over 5% represent? Second, after a major correction, how will the market move?
Looking back, over the past decade, there have been few trading days when the Nasdaq index fell more than 5% in a single day (see Table 1). But there is a positive phenomenon: after major drops, the index often recovers, and even hits new highs. For example, the Nasdaq index fell 5.82% on April 4, 2025, but that turned out to be the low point. From April 5, 2025, to June 1, 2026, the index cumulatively rose over 70%. The Nasdaq index covers a host of AI industry giants, and behind its major decline there was a trigger — market concerns about Democrats restricting AI infrastructure development fermented, directly triggering a major correction in US tech stocks. But some views suggest this may not be bad news, because if AI investment slows, the cash flow pressure on some major companies could become more optimistic.
Renowned investor Dan Bin, who focuses on the US AI industry chain, recently stated that this decline is a short-term shock, and the probability of concluding that the AI era is over is extremely small.
Turning back to A-shares, the overall market is still in the bottom range of "stabilization → rebound recovery." Although there was an overall pullback today, the number of limit-down stocks was not large, indicating that divergence exists but is far from extreme panic. Going forward, whether the November 6 gap can be filled and when will be the key focus. Currently, looking at indices, there are not many bright spots, but looking at individual stocks, there are quite a few highlights. For example, many stocks opened lower with the broader market today but then strongly closed in the green or even hit limit-up, such as Hua Hong Semiconductor, Zhaofeng Shares, Haizheng Biomaterials, Riyu Dongfang, and Xinya Process ( rights protection ). Xinya Process opened more than 5% lower, but during the session a large order worth 50 million yuan entered, directly sealing its third limit-up at a low position (see Figure 1).
Can the Dividend Strategy Survive This Cycle? Insurance Capital Increases Positions
The good side is also reflected in the fact that a batch of stocks are still hitting new highs amid the weak market. According to incomplete statistics, more than 200 stocks hit new highs since July over the past three trading days. There are thematic stocks such as Shanghai Film and Guilin Sanjin, as well as dividend stocks such as Yili Group, China Shenhua, Midea Group, and Kweichow Moutai, as can be seen (Table 2).
For a long time, dividend stocks have been key ballast for institutions such as insurance capital. Recently, insurance capital stake-building has reappeared. On October 30, China Pacific Life Insurance and related parties bought 8.1075 million H-shares of China Shenhua, with total shareholding exceeding 5%, triggering a stake-building disclosure. In terms of stock price, China Shenhua H-shares have been in a slow bull market for six years. In the third quarter of this year, as the market came under pressure and adjusted, insurance capital continued to focus on stable dividend assets for increased allocation. For example, China Life Insurance (traditional-ordinary insurance product, hereinafter specifically referred to) increased its positions in multiple dividend or stable-track stocks during the third quarter (see Table 3). In terms of stock price performance, many of China Life's increased holdings rose against the market. For example, ENN Natural Gas, which belongs to the gas sector — a previously overlooked track — has seen its stock price stage a complete V-shaped reversal since the July market adjustment. As of the close on November 6, it had cumulatively risen over 40%. On November 6, the day the market adjusted, it actually rose over 2% against the trend (see Figure 2). During the third quarter, China Life increased its position by 5.524 million shares to 103.7935 million shares, with a holding market value of 1.993 billion yuan at the end of the third quarter.
In conclusion, the market action since November is reflecting the positive impact of the "policy bottom." Going forward, with dividends providing a floor and growth offering elasticity, the structural market may continue to play out, and the market bottom will become increasingly clear.
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