CSI300 dropped 2.6%
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This week saw diverging performance among major indices, with A-shares under pressure while U.S. markets showed steady gains. SSE Index closed at 3,267.19 points, down 1.91% for the week. Although trading volume was slightly above its 50-day moving average, prices remained 11.08% below their 1-year high. The CSI 300 fell further, losing 2.6% over the week. Meanwhile, the Shenzhen Index and ChiNext Index dropped 2.89% and 3.03%, respectively, reflecting weak market sentiment against the backdrop of global economic pressures and recalibrated domestic macroeconomic expectations. In contrast, U.S. indices outperformed, with the Nasdaq Composite rising 1.56% and the S&P 500 gaining 1.33%, both approaching their 1-year highs. The Nasdaq closed at 18,972.42, just 2.03% below its 1-year peak, demonstrating strong relative strength. This divergence highlights differences in capital flow trends and macroeconomic fundamentals across the regions.
On the macroeconomic front, China’s October electricity consumption grew 4.3% year-on-year, down from the previous figure of 8.5%, signaling a slowdown in industrial activity. Additionally, the Ministry of Finance allocated a 6 trillion yuan debt quota to local governments, with some provinces already commencing bond issuance. While this may provide funding support for regional economies, the associated local government debt risks warrant attention. Internationally, U.S. EIA crude oil inventories rose by 545,000 barrels for the week ending November 11, surpassing expectations and potentially pressuring oil prices. Meanwhile, U.S. initial jobless claims for the week ending November 16 came in at 213,000, lower than anticipated, indicating continued strength in the labor market.
On the policy front, the State-owned Assets Supervision and Administration Commission (SASAC) emphasized support for central enterprises in exploring growth “second curves” by focusing investments on forward-looking strategic emerging industries. This provides clear guidance for investments in related sectors. Additionally, the reduction in fees for multiple large-cap ETFs, which will save investors over 50 billion yuan annually, is expected to lower costs and boost market participation.
In terms of industry performance, the Diversified Operations (G9900IG.CN) stood out this week with a gain of 15.22%. This was followed by the Retail/Whlsle-Automobile (G5014IG.CN) and the Retail/Whlsle-Bldg Prds (G5211IG.CN), which rose by 10.98% and 5.8%, respectively. The strong performance of these sectors is likely closely related to the recovery in consumption-related demand and support from government policies.
Among the Top 33 stocks, performance was notably weak this week, with an average decline of 4.53%. Only five stocks posted gains, while 28 saw losses. Notably, Espressif Sys Shanghai (688018) stood out with a 7.43% increase this week. The company boasts an O’Neil Score of 78, RS Rating of 92, and a remarkable EPS Rating of 94, underscoring its robust fundamentals and market recognition. Specializing in IoT Wi-Fi communication chips and modules, Espressif Systems leverages technological advantages and an open-source ecosystem to maintain strong competitiveness in international markets. With growing global demand for smart home and industrial IoT applications, this field remains promising.
The market is currently in a “rally under pressure” phase. Investors are advised to act cautiously, prioritizing high-quality stocks in top-ranked industries (Rank 1-40). Companies demonstrating significant profitability and market recognition, remain worthy of attention. Meanwhile, closely monitoring U.S. market performance and domestic macroeconomic trends will help refine portfolio management strategies. Maintaining cash reserves is prudent to navigate potential market volatility effectively.
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Notice: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. It is for educational purposes only.
published on November 22, 2024