CSI 300 Falls 1.27%
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The judgment that A-shares are “meeting resistance in their uptrend” remains unchanged. Major indexes generally weakened this week, while trading volume failed to expand effectively, reflecting a continued decline in risk appetite. The SSE Index(000001) fell 1.17% for the week, slipping back below 4,000 points. On the final trading day, volume was 3.42% below its 50-day average, while the index closed below its 5-day, 10-day, 20-day, 50-day, and 200-day moving averages, signaling a fairly clear deterioration in short-term momentum. The CSI 300(000300) declined 1.27% for the week. Although final-day volume was 5.58% above the 50-day average, the index still remained below its 5-day through 50-day moving averages, suggesting limited follow-through buying in heavyweight sectors. Growth-oriented segments came under even greater pressure: the Shenzhen Index(399001) fell 3.53%, while ChiNext(399006) dropped 4.41%, standing about 4.02% and 6.44% below their respective 20-day moving averages, indicating more pronounced valuation compression in high-beta sectors.
Overseas markets presented a stark contrast to A-shares. The Nasdaq Composite(0NDQC) rose 1.45% for the week, and the S & P 500 Index(0S&P5) gained 0.81%. Both moved back above their 5-day, 10-day, 20-day, and 50-day moving averages, showing that risk appetite in U.S. equities remains elevated. The Hang Seng Index(HSI) climbed 3.53%, reclaiming its 5-day, 10-day, and 20-day moving averages. Southbound capital continued increasing allocations to technology shares, pointing to a clear phase of recovery in Hong Kong equities. That said, the index still remains below its 50-day and 200-day moving averages, so its medium-term trend has yet to be fully confirmed.
Overseas, the latest U.S. data and geopolitical headlines jointly reinforced the view that “inflationary disruptions persist, and monetary policy is unlikely to ease easily.” U.S. EIA crude oil inventories unexpectedly rose by 2.998 million barrels in the week ended July 3, far above market expectations for a 2.371 million barrel decline. On the surface, this should exert some downward pressure on oil prices. At the same time, however, tensions between the U.S. and Iran escalated again, and shipping volume through the Strait of Hormuz dropped sharply, implying a rapid rise in global energy transport risk. In other words, short-term inventory changes may not be enough to fully offset upward pressure on oil prices stemming from geopolitical conflict.
Labor market data suggest that the U.S. economy has not yet shown clear signs of a sharp slowdown. Initial jobless claims for the week ended July 4 came in at 215,000, slightly below both expectations and the prior reading, indicating that the labor market remains resilient. This combination of “steady employment and geopolitically driven inflation risk” is likely to keep the Federal Reserve more cautious on policy. The market remains divided on whether rate hikes could resume, and the core reason is that the U.S. economy has not weakened materially, while oil prices, tariffs, AI investment, and geopolitical conflict may all continue to push inflation expectations higher.
Domestically, policy priorities are increasingly focused on advancing “stable domestic demand, transformation and upgrading, and risk prevention” in parallel. The People’s Bank of China has clearly stated that it will strengthen financial support for key areas such as expanding domestic demand, technological innovation, and small and micro enterprises. This suggests that monetary policy will remain forward-looking, flexible, and targeted. Rather than resorting to broad-based monetary flooding, policymakers are more likely to improve the efficiency of capital allocation through structural tools. This means the next phase of policy will place greater emphasis on precision support for consumer recovery, technology upgrading, and the development of private small and medium-sized enterprises.
Efforts to expand domestic demand are also continuing to intensify. Nine government departments introduced 20 measures to accelerate retail sector development, while the State Council approved the 15th Five-Year Plan for building a tourism powerhouse. This shows that policy support is extending from goods consumption to services consumption and the recovery of offline consumption scenarios, with the aim of strengthening the economy’s endogenous growth drivers. Meanwhile, the full rollout of the project list for the “Two Major” construction initiatives indicates that major project investment remains an important lever for stabilizing growth and can help offset pressure from external uncertainty.
At the medium- to long-term policy level, technology, security, and green transformation are being advanced simultaneously. The Cyberspace Administration of China has continued to crack down on disorderly AI applications, reflecting an approach that places equal emphasis on encouraging development and strengthening regulation. The State Council also released its 15th Five-Year carbon peaking action plan, explicitly calling for a higher share of non-fossil energy consumption, indicating that green transformation has become a major long-term theme in industrial policy. The release of notices on flood control and drought relief also suggests that macro policy is placing greater emphasis on the potential impact of extreme weather on agriculture, energy, and supply chains.
This week’s top-performing industries were concentrated in Wholesale-Electronics, Computer Sftwr-Security, and Comp Sftwr-Spec Enterprs. Wholesale-Electronics(G3577IG.CN) rose 9.98% for the week. Strength in this segment is usually associated with improved semiconductor component distribution, stronger activity across consumer electronics supply chains, and rising expectations for inventory replenishment in the electronics industry chain. Computer Sftwr-Security(G3220IG.CN) gained 6.47%, indicating that capital continued to reinforce this theme into the weekend. This reflects improving expectations for data security, domestic substitution in IT innovation, compliance spending, and government-enterprise security investment. In particular, with policy continuing to emphasize digital infrastructure, technological self-reliance, and information security, security software is more likely to benefit from both thematic and fundamental support. Comp Sftwr-Spec Enterprs(G2761IG.CN) advanced 6.11%, reflecting stronger market expectations for corporate digital transformation, industry informatization, and a recovery in demand for project-based software services.
The Top 33 portfolio showed relatively weak performance, with an average weekly decline of 4.69%. Only 8 stocks rose, while 25 declined, indicating that the universe of market leaders continued to narrow and that the wealth effect weakened significantly. The best-performing stock was Hangzhou Chang Chuan Tech(300604), which rose 16.39% this week. The company primarily manufactures specialized equipment for integrated circuits and has benefited from semiconductor equipment localization and demand for advanced packaging and testing. Its O’Neil Score is 73, RS Rating is 99, EPS Rating is 99, Acc/Dis Rating is A+, and Industry Rating is 3. These metrics indicate that the company combines strong exposure to a high-growth industry with outstanding earnings and price strength characteristics, making it the kind of stock that can still attract capital concentration even in a weak market.
At present, A-shares have yet to shake off adjustment pressure. Major indexes have broadly fallen below their short- and medium-term moving averages, while the Top 33 portfolio has weakened overall, suggesting that the market remains in a narrowing, concentrated trading environment. Capital is showing a clearer preference for stocks in top-ranked industries, with stronger earnings resilience and standout relative strength, while willingness to chase momentum has become significantly constrained. If the indexes fail to quickly reclaim their 20-day and 50-day moving averages, market style will likely remain dominated by defensive positioning and structural rotation.
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published on July 10, 2026