The market showed slight divergence in early trading today, with the Shanghai Composite Index closing marginally higher by the end of the session, while the ChiNext Index underperformed. Boosted by a warming Spring Festival box office and the viral success of Seedance, the media sector surged once again. Total market turnover reached 2.1 trillion yuan, contracting by over 100 billion yuan compared to the previous trading day. Overall, declining stocks outnumbered gainers in the two exchanges.
Sector-wise, AI application-related stocks experienced a wave of limit-up gains, with sharp rallies seen in film and television, short dramas, ByteDance's Doubao, virtual economy, and multimodal AI segments. Recent developments include the rapid spread of ByteDance's AI video generation model, Seedance 2.0, across domestic and international internet platforms during its limited testing phase. Additionally, ByteDance's image generation model, Seedream 5.0, has been launched, positioning itself as a competitor to Nano Banana Pro. Alibaba's Qianwen also introduced its new-generation foundational image generation model, Qwen-Image-2.0.
In other highlights, the biopharmaceutical sector rose, led by innovative drug stocks, with companies like Wanbangde hitting the limit-up. Computing power concept stocks extended their gains, with Dawei Technology and Liande Co., Ltd. both securing their second consecutive limit-up boards. On the downside, consumer sectors such as retail and baijiu saw adjustments; Hangzhou Jiebai dropped by the limit-down, while Huangtai Wine Industry approached a limit-down fall.
In focus stocks, the new commercial aerospace listing, Dianke Lantian, skyrocketed by as much as 750% on its debut, eventually closing nearly 600% higher, with a total market capitalization exceeding 110 billion yuan. The company's main business involves the R&D, production, sales, and services of electric energy products and systems, including aerospace power supplies, special-purpose power supplies, and new energy applications and services.
Looking ahead, China Securities Co., Ltd. indicated that due to the long holiday effect, short-term bull-bear博弈 has moderated, and the market is likely to consolidate with fluctuations. Guosen Securities added that the current spring rally may still have further room to unfold, suggesting that a strategy of holding stocks over the holiday might be relatively favorable.
In terms of individual performances, 2,195 stocks advanced, 3,128 declined, and 159 remained unchanged across the two exchanges. A total of 70 stocks hit the limit-up, while 12 fell to the limit-down. At the close, the Shanghai Composite Index rose 0.13% to 4,128.37 points, with a turnover of 882.2 billion yuan. The Shenzhen Component Index edged up 0.02% to 14,210.63 points, with a turnover of 1,223.3 billion yuan. The ChiNext Index declined 0.37% to 3,320.54 points.
Fund flows today showed main capital heavily favoring sectors such as film and cinema chains, publishing, and digital media. Stocks with significant net inflows included Guangxian Media, Sungrow Power Supply, and Xinyisheng.
Key news recaps: 1. Five departments including the Ministry of Industry and Information Technology issued an implementation opinion on strengthening the information and communication industry's capacity building to support low-altitude infrastructure development. The document emphasizes coordinated development between the information and communication industry and low-altitude equipment manufacturing, enhancing technical foundations, industrial supply capabilities, network support, and security safeguards. It also outlines steps to advance communication network construction for low-altitude scenarios, enrich sensing technologies, improve navigation positioning accuracy, and support the development of low-altitude intelligent connected systems. 2. The new round of centralized procurement for national volume-based drug purchasing, covering 316 commonly used drugs from the first to eighth batches, concluded with preliminary selected results announced on February 9. This procurement involves 26 therapeutic areas, including anti-infectives, anti-tumor drugs, diabetes and hypertension medications, lipid-lowering agents, and drugs for nervous, respiratory, and digestive systems. A total of 51,000 medical institutions participated, with 1,091 domestic and international companies submitting 4,623 products; 1,020 companies saw 4,163 products preliminarily selected. 3. Market rumors suggest Chow Tai Fook plans to adjust gold product prices after the holiday, drawing widespread attention from the industry and consumers. Verification with Chow Tai Fook stores indicates the price adjustment may officially start in mid-March, with some stores already notified. The increase is expected to focus on fixed-price products, with estimated rises of 15%-30%, though specific details and implementation will depend on in-store price tag updates.
Post-market analysis: 1. China Securities Co., Ltd. stated that the pre-holiday small rally in A-shares may continue. Influenced by the long holiday effect, short-term market fluctuations are expected to moderate, with consolidation likely. Previous significant筹码 releases have occurred, and regulators aim for stable pre-holiday operations, coupled with expectations of Spring Festival consumption boosts and generally supportive policies. Overseas, U.S. Treasury Secretary Besant recently indicated that the new Fed chair is unlikely to rapidly implement balance sheet reduction, possibly not for at least a year and a half, suggesting low probability of Fed tapering before mid-2027. Current pricing maintains expectations of at least two Fed rate cuts in 2026, indicating an overall accommodative macro liquidity environment for the year. Overall, indices are expected to fluctuate near current levels pre-holiday, with previously oversold stocks likely to see gradual recovery, extending the small rally. 2. Guosen Securities noted that historical spring bull markets often see index gains of around 20%. Since December 17, 2025, the Shanghai Composite's maximum gain has been 9.8%, leaving room for further upside compared to historical patterns. A strategy of holding stocks over the holiday may be relatively optimal in the short term. 3. Soochow Securities research reported that the week before the holiday is the best window for index positioning, with反弹拐点 typically occurring around five days prior. Reviewing Spring Festival rallies since 2006 shows that after initial consolidation, indices often begin trending rebounds about five trading days before the holiday. These rallies generally persist until around T+6 days post-holiday, with clear upward trends that gradually flatten. Style-wise, large and small-cap rotations are prominent around the holiday. Historically, large-caps outperform small-caps pre-holiday, with growth generally beating value; post-holiday, small and micro-caps take the lead, showing significant reversal effects.
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