On February 11, China's three major stock indices closed mixed, with the ChiNext Index and the STAR 50 Index falling over 1%. At the close, the Shanghai Composite Index edged up 0.09%, while the Shenzhen Component Index declined 0.35%, and the ChiNext Index dropped 1.08%.
Sector-wise, the chemical industry repeatedly strengthened recently, with fiberglass concepts surging rapidly and nonferrous metals showing active performance. On the downside, film and cinema-related concepts collectively declined.
Over 3,200 stocks fell across the broader market. The trading volume on the Shanghai and Shenzhen stock exchanges shrank by 121.3 billion yuan compared to the previous session, dropping below 2 trillion yuan for the first time in 31 trading days.
Today marked the third-to-last trading day of the Lunar Snake Year and the middle of the week—a period often corresponding to the final "chaotic phase" before the Spring Festival rally.
The A-share market's full-day turnover reached only 2001 billion yuan (1984.3 billion yuan combined for Shanghai and Shenzhen), hitting a new low since 2026. Insufficient liquidity led to market divergence from the opening bell.
Questions lingered over whether high-flying stocks should or could be chased and which sectors were suitable for bargain hunting. For instance, film, media, and gaming sectors, which surged collectively yesterday, opened high but quickly turned lower in the morning. Only a few survivors like Zhangyue Technology, Huanrui Century, and Decai Holdings recorded three consecutive limit-ups.
AI hardware, already underperforming recently, faced capital outflows. Heavyweights such as Zhongji Innolight and Xinyisheng experienced significant intraday declines before partially recovering in the afternoon.
The commercial aerospace concept, which had been consolidating for some time, briefly rallied in the morning following news of the successful dual-test launch of the Long March 10A rocket but lost momentum in the afternoon.
Analysts noted that in a market environment dominated by存量博弈 (existing capital games), hotspots continued to rotate rapidly, making timing crucial. As a result, funds clustered in cyclical stocks like nonferrous metals and chemicals emerged as the day's biggest winners.
These sectors were buoyed by price increase catalysts. According to China Tungsten Online, prices of light and heavy rare earth products rose significantly on February 10. For example, praseodymium-neodymium oxide, praseodymium-neodymium metal, and terbium oxide prices increased by approximately 50,000 yuan/ton, 65,000 yuan/ton, and 50,000 yuan/ton, respectively. On February 9, molybdenum concentrate, ferromolybdenum, and ammonium heptamolybdate prices rose by about 20 yuan/ton, 1,000 yuan/ton, and 4,000 yuan/ton, respectively. The price of 65% black tungsten concentrate reached 685,000 yuan/ton, up 48.9% since the beginning of the year, while 65% white tungsten concentrate hit 684,000 yuan/ton, a 49% increase. Ammonium paratungstate (APT) prices rose to 1 million yuan/ton, up 49.3% year-to-date.
Zhejiang Longsheng recently announced that on February 8, it raised prices for some disperse dye varieties, citing rising costs of reduction intermediates as the direct factor. Key products like disperse black have cumulatively increased by 5,000 yuan/ton recently. Sustainability of these price hikes depends on supply-demand dynamics.
Runzhou Industrial stated that its dye product prices follow market trends, adopting a price-tracking strategy. Due to recent increases in reduction intermediate costs, the company's disperse black dye price has risen by about 5,000 yuan/ton cumulatively.
A Huatai Securities research report indicated that on February 4, two leading fiberglass manufacturers raised electronic cloth prices again. The new round of hikes not only featured significant幅度 but also shorter cycles, reflecting a shortage spreading from high-end to standard products. Huatai noted that supply constraints for standard electronic cloth, coupled with orderly demand recovery, could initiate a new price increase cycle by 2026, boosting earnings flexibility for related firms. Meanwhile, high-end electronic cloth products like second-generation low-dielectric (LDK2) and low-thermal-expansion (LCTE) varieties may still face supply gaps in 2026, supporting further price increases.
Additionally, the latest data from the National Bureau of Statistics showed that in January 2026, prices in the nonferrous metal mining and dressing industry rose 22.7%, while nonferrous metal smelting and rolling processing prices increased 17.1%.
Data from the China Nonferrous Metals Industry Association also revealed that in 2025, total assets of large-scale nonferrous metal industrial enterprises exceeded 6.6 trillion yuan, up 8.2% year-on-year. Operating revenue reached 10.2 trillion yuan, growing 13.9%, and industry profits hit a record high of 528.45 billion yuan, surging 25.6%.
Among exchange-traded funds (ETFs), several nonferrous metal-themed ETFs outperformed. For instance, the Nonferrous Metals ETF (159871) gained 2.44% by the close, ranking 25th among thematic ETFs and leading its peers. The fund tracks the CSI Nonferrous Metals Index, which selects listed companies involved in nonferrous metal mining, smelting, and processing to reflect overall sector performance.
CITIC Securities pointed out that the market may have overestimated the hawkish stance of new Fed Chair Kevin Warsh, but uncertainties surrounding Iran remain high. Gold market volatility may only subside once the situation stabilizes. For the full year 2026, the firm maintains an optimistic outlook on precious and nonferrous metal prices.
Notably, the nonferrous metals sector's strong performance partly bolstered the Shanghai Composite Index. Wind data showed that most of the top ten stocks contributing to the index's gains today were from this sector.
On a daily chart basis, despite recent volatile rebounds, the Shanghai Composite Index has quietly notched seven consecutive positive sessions. Although a few sessions included false gains, this marks the latest and longest winning streak since the 17-session rally ended in mid-January.
A Pacific Securities report suggested that when risks are hard to control, reducing positions may be the optimal strategy before the Spring Festival. It emphasized prioritizing win rates and risk-reward ratios. Given elevated uncertainties and extended holiday exposure, aggressive positioning could lead to significant potential drawdowns, akin to "seeking victory after already losing."
Huaxi Securities noted that after Monday's surge, the market entered a "cooling-off period," characterized by low-volume fluctuations—active in themes but lacking broad momentum. Statistical analysis indicates post-holiday markets tend to be more vibrant. The average volume ratio for rising days in the 20 sessions after Spring Festival is 1.2, notably higher than the usual 1.04; for declining days, it's 1.13, above the typical 0.97. This implies that, on average, capital reacts more sharply to market shifts after the holiday. Positive developments during the break could catalyze strong thematic trends post-holiday, as seen with AI and robotics themes that dominated trading for nearly a month after the January 2025 festival.
Comments