The market opened lower and then rose on June 17th, with the ChiNext Index and the Shenzhen Component Index both gaining over 1%, and the STAR 50 Index surging more than 4.5%. At the close, the Shanghai Composite Index was up 0.4%, the Shenzhen Component Index rose 1.31%, and the ChiNext Index climbed 1.56%.
By sector, PCB concepts surged, the semiconductor industry chain was active with storage chips and semiconductor equipment leading gains, and the glass substrate concept maintained strength. On the downside, the coal sector adjusted. Over 3,700 stocks fell across the market. The combined turnover for the Shanghai and Shenzhen exchanges was 3.09 trillion yuan, an increase of 27.1 billion from the previous session.
Prior to the market open today, many expected an adjustment for A-shares, primarily for three reasons. First, the tech sector had already risen for two consecutive days, accumulating some profit-taking pressure. Second, today was a typical "fund outflow day" of the week, with internal funds needing to settle. Third, in anticipation of the upcoming debut by Federal Reserve Chair Michelle Bowman, overnight U.S. stocks and early Asian markets had adjusted, affecting opening sentiment for A-shares.
The early session saw the three major indices open lower, confirming this view. However, led by a sudden move in PCB concepts, the indices quickly rebounded into positive territory. In this situation, some short-term capital was forced to continue clustering in hot thematic areas, primarily in upstream materials.
Nevertheless, funds needing to exit still executed their plans. Starting around 10:15 AM, the yellow lines representing the broader market for the three major indices peaked and began to fall back, indicating cooling sentiment for individual stocks. After 11 AM, the three major indices also retreated rapidly one after another.
At this point, the overall market situation reached a tense juncture. Coincidentally, some news emerging from the Lujiazui Forum during the midday break introduced a new variable.
After the market reopened in the afternoon, the semiconductor industry chain took over as the leading gainer. The STAR 50 Index surged significantly, alleviating intraday panic. The communications equipment sector, also part of the main tech theme, gradually strengthened towards the close.
Ultimately, the ChiNext Index fluctuated and rose in the afternoon, hitting a new intraday high. The Shanghai Composite Index also managed to turn positive, reclaiming the 4100-point level and breaking above the 30-day moving average which had been acting as resistance.
Key Developments from the Forum
Based on public reports, statements made at the forum by People's Bank of China Governor Pan Gongsheng and China Securities Regulatory Commission Chairman Wu Qing are noteworthy.
Pan Gongsheng stated that efforts will be made to promote medium- and long-term capital investment in the stock and bond markets. He mentioned researching the establishment of macroprudential tools to provide non-bank liquidity support under specific scenarios and improving the short-term interest rate control mechanism.
Wu Qing made several remarks directly concerning A-shares. He noted that the market capitalization of the A-share technology sector now exceeds 30% of the total. Among listed companies with a market cap over 100 billion yuan, technology firms account for 45%. He also mentioned the ongoing deepening of reforms for the "two innovation boards" (ChiNext and STAR Market). The combined number of companies listed on the STAR Market and ChiNext now exceeds 2,000, with a total market capitalization over 35 trillion yuan.
He stated that the next steps will involve further enriching investment products and tools, supporting the launch of active ETFs on the Shanghai and Shenzhen exchanges. The approach will adhere to a phased, step-by-step, steady, and progressive development strategy, first launching pilot products while simultaneously improving supporting systems and ecosystem development.
He also emphasized a strict crackdown on behaviors that use technology as a pretext to ride on hot topics, hype concepts, or engage in market manipulation and insider trading. Guidance for regulating the development of artificial intelligence in the capital market will be issued at an appropriate time, with severe legal penalties for illegal activities such as using AI for unauthorized stock recommendations, spreading rumors, or illegal trading.
Interpreting the Market Action
A recent research report from Galaxy Securities suggested that A-shares are highly likely to continue a volatile, consolidating trend in the short term, with the market dominated by structural opportunities. It advised monitoring the marginal impact of the upcoming Federal Reserve meeting on market expectations and the structural guidance from preliminary half-year earnings reports.
From an allocation perspective, the report noted that the recent adjustment in the growth sector is a healthy correction process. Short-term volatility does not alter the medium-to-long-term positive industry trends, and high-growth tech sectors remain the main allocation theme for the market in the medium to long term.
Some fund managers have expressed that looking ahead to the second half of the year, technology growth is still expected to be the core theme. High industry景气度 is likely to be maintained in core areas like AI computing power, optical communications, and storage chips. However, after sustained market performance, trading拥挤度 has significantly increased, and the overall investment性价比 has notably declined compared to the beginning of the year. Subsequently, the sector may move away from broad-based gains and enter a phase of stock selection and increased volatility.
Sector-Specific Moves
Regarding the early leaders, PCB and glass substrate concepts, the main catalyst for the former was a recent price increase notice issued again by leading copper-clad laminate manufacturer Kingboard Laminates Holdings Ltd. Analysis suggests AI computing power is driving demand for high-end PCBs. AI servers and high-speed optical modules impose higher requirements on PCB substrate layers, processing precision, and signal loss, directly boosting demand for high-end PCBs and upstream copper-clad laminates.
For the latter, news emerged that Taiwan Semiconductor Manufacturing recently issued a "Glass Substrate Development Plan for CoWoS" to its supply chain, confirming collaboration with ABF substrate supplier Ibiden and panel maker Innolux to jointly verify the feasibility of introducing glass substrates into CoWoS advanced packaging. This marks TSMC's first public disclosure of its glass substrate technology application progress, signifying that glass substrates have officially entered the industrial validation phase.
Regarding the sectors that strengthened in the afternoon, semiconductor equipment and storage chips, a report from SEMI showed that global semiconductor equipment billings in the first quarter of 2026 increased 14% year-over-year to $36.55 billion, up 1% sequentially. The record quarterly sales were driven by continued AI-related investments, including capacity expansion and technology upgrades supporting advanced logic chips, DRAM, and advanced packaging.
Morgan Stanley published a report stating that driven by sustained growth in demand from AI data centers, the supply-demand tightness in the hard disk drive industry is exceeding expectations, and the shortage situation may persist at least until 2028.
Additionally, in non-tech sectors, China-concept stocks also showed activity in the afternoon session.
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