For stock investors, the Golden Kirin analyst research report offers authority, professionalism, timeliness, and comprehensiveness to help uncover potential thematic opportunities. Source: Securities Market Weekly Magazine Market Account. By Shui An.
In the market at the end of September, some people said it "felt like July again," and those holding cash with no positions temporarily won. Some turned and retreated, some wanted to leave but could not. Yet others began searching for new opportunities, believing that rising prices mean risk while falling prices mean opportunity.
In fact, on September 29, many stocks that had previously undergone significant corrections staged strong recovery rallies, such as PCB names like Yidun Electronics, Chaosheng Electronics, and Qiangda Circuit. On September 28, renowned investor Duan Yongping posted that he had bought 30,000 shares of Kweichow Moutai. It is worth noting that since hitting a historic high in February 2021, Kweichow Moutai's share price has declined for years, and the latest price is nearly halved from its peak. Duan Yongping's move to add to his position offers some food for thought, particularly regarding the importance of contrarian thinking and a long-term perspective in investing.
Before the National Day holiday, A-shares had already "completed their decline." The key question is how the market will move after the holiday. Will it need to fall further to find a bottom? Or will a turning point emerge, leading to a major rebound? Today's content provides further analysis for everyone.
Is a Breakdown Another New Opportunity? Bottom-Fishing Capital Has Already Entered
Recently, I have received many messages from fellow investors in the background, and there is much to reflect on and feel. Some said that since the market has already fallen this much, there is no point bringing up "9/24" anymore; that A-shares show no sign of bottoming; that the "bubble squeezing" in tech stocks is not over yet... Indeed, the current market resembles a fish tail—its direction swings quickly and with increasing amplitude.
On September 28, after a long period of failing to break through, the index experienced a further breakdown. The ChiNext fell more than 4%, breaking below its late-July low and pointing directly toward its early-April low. Immediately following were two core questions on many people's minds: First, will there be a correction on the scale of July's? Second, if the decline stops next, can we see another large-scale recovery rally like August's?
Regarding the first question, many voices believe there is no need for excessive worry. Although the index broke down, there have been rebounds and repairs, as already demonstrated in the market on September 29. Moreover, the triggering factors are different. The extreme correction in July was triggered by South Korea's rate hike, which caused a stampede of global leveraged fund liquidations, with tech sector crowding reaching historic extremes. The current correction in September is related to pre-holiday effects and other factors, but tech stock crowding has significantly decreased.
For the second question, some answers can also be found from the performance of certain typical stocks—structural repair of individual stocks will not disappear. Recently, many stocks have staged "next-day recovery after a sharp decline" rallies.
Yibo Technology: the company announced on September 23 a plan to invest no more than 800 million yuan to build the second phase of its Zhuhai PCB factory. The very next day, on September 24, its stock price opened higher but closed lower, falling more than 6%. But on September 29, the stock price surged again, rising nearly 10% at one point during the day.
Besides Yibo Technology, many other stocks also staged "decline one day, recovery the next" rallies. On September 29, PCB sector names such as Jinlu Electronics, Chaosheng Electronics, Yidun Electronics, and Xunjiexing either surged or hit the daily limit, while on September 28, their stock prices had all undergone significant corrections. Other stocks such as Zhongjie Co., Sunwoda, Luchang Technology, and Tongye Technology moved against the market decline, initiating low-position volume breakout patterns.
For example, Zhongjie Co., which has concepts related to energy storage, liquid cooling, and data centers, closed with a "20cm" daily limit up on September 29. Since its low-position launch on September 16, the stock has surged more than 50% (see Figure 1). It is worth mentioning that some companies' stock prices, while also at relatively low levels and showing breakout signals, were confirmed as "false breakouts," with prices subsequently correcting. For example, Jiangnan New Materials rose 10% on September 23, then fell nearly 10% the next day (September 24), and continued to fall nearly 10% on September 28 (see Figure 2).
From cases like Zhongjie Co. and Jiangnan New Materials, it is clear that not all bottom-launch signals lead to major rallies. This raises a question many people care about—which breakout patterns are more likely to lead to major rallies after appearing? In response, the author has compiled this exclusive collection video to explain it all clearly at once.
Will A-Shares Rally Again After the Holiday?
Some attribute one of the triggers of this late-September correction to the "National Day" pre-holiday effect. Looking at history, however, funds tend to quickly show optimistic sentiment after the holiday, and A-shares often stage rallies after the holiday, with the characteristics of pre-holiday risk aversion and post-holiday capital return being evident.
Statistics on the Shanghai Composite Index's first-day performance after the "National Day" holiday over the past 20 years (2006-2025) show that there were 6 trading days of decline and 14 trading days of gains (see Table 1), with a rise probability of 70%. But further analysis, combined with specific market environments and time windows, shows that the market has also exhibited multiple special characteristics. For example, in 2009 and 2024, the first day after the holiday both saw major rallies, with the Shanghai Composite Index rising more than 4% both times. The special nature of the 2024 rally lies in the continuation of bullish sentiment after the "9/24" rally. In contrast, the first day after the holiday in 2008 and 2018 both saw significant declines.
Although single-day performance carries emotional factors and randomness, from the perspective of certain phased performances, the market has experienced main rally phases in some years. For example, after the "National Day" holiday in 2020, the Shanghai Composite Index launched a major cyclical rally, rising nearly 15% from October 9, 2020, to December 19, 2021 (see Figure 3).
Historical data is only a retrospective and cannot predict the future. Whether A-shares can stop declining and stage a reversal after the holiday is closely tied to multiple domestic and international factors, including the following core elements:
Overseas Federal Reserve monetary policy and US Treasury yield trends. Focus on the Fed's FOMC meeting on October 27-28. Additionally, US Treasury yields continue to climb, with the 30-year Treasury yield having risen to 5.58%, a new high since 2002.
US-Iran geopolitical conflicts and commodity price performance. If the geopolitical situation escalates further, it will directly push up oil and industrial metal prices, which on one hand will exacerbate global inflation stickiness, and on the other hand will suppress A-share market sentiment. Since mid-September, oil prices have seen some pullback but remain at relatively high levels.
Favorable policies and industry-side catalysts. The fourth quarter is a window of dense policy activity, and market sentiment is expected to be boosted as a result. In fact, just before the holiday, related favorable policies and performance landed in A-shares, such as the issuance of the "15th Five-Year Plan for the Development of New Battery Industry," which directly drove the heating up of mainlines such as solid-state batteries. The aforementioned stocks like Zhongjie Co. and Sunwoda all benefited from this.
The window for listed companies' third-quarter earnings reports opens. Looking back at this year's first-quarter and interim reports, stocks with better-than-expected growth in computing power, optical communications, and other sectors appeared in batches. The degree of earnings realization in the third-quarter reports will directly revise the valuations of previously high-performing stocks and thematic plays. Targets with excess returns and high earnings elasticity may become the focus of a new round of capital allocation. Here, we have compiled a timetable for the third-quarter report disclosures of some stocks with large interim earnings growth in 2026, for your reference (Table 2).
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