Since the beginning of September, banking stocks have been on a strong upward trend, with several banks hitting record highs. Today, China Construction Bank's total market capitalization surpassed that of Industrial and Commercial Bank of China, making it the new "leader."
Today, shares of China Construction Bank Corporation (ASX: 00939) reached a new high, rising 1.46% for the day, with a total market capitalization of 3.08 trillion yuan. Meanwhile, the "universal bank" Industrial and Commercial Bank of China Limited (ASX: 601398) also saw its shares rise, but only by 0.47%, with a total market capitalization of 3.07 trillion yuan.
China Construction Bank has been hitting new highs over the past two years and has finally become the market cap leader. Today, banking stocks opened lower but were pulled up all the way. In contrast, the Shanghai Composite Index and the ChiNext Index opened higher but trended lower, moving in the opposite direction of banking stocks.
U.S. stocks rose last night, and today Japanese and South Korean stock markets also surged. However, tech stocks did not follow the rally in overseas markets, prompting investors to exclaim: banking stocks are China's Nasdaq!
Since September, the stock prices of Industrial and Commercial Bank of China Limited (ASX: 601398), China Construction Bank Corporation (ASX: 601939), Bank of China, Bank of Communications, China CITIC Bank, Bank of Hangzhou, Bank of Changsha, Bank of Jiangsu, Bank of Nanjing, Bank of Chengdu, and Bank of Qingdao have all hit record highs.
On October 22, Goldman Sachs released a report titled "Reflections on the Chinese Market: Diverging China-U.S. Interest Rates Make Cash Returns More Attractive for Allocation," upgrading the A-share banking sector to overweight.
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