CSI 300 rose by 0.88%
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This week, the A-share market continued its Rally Attempt, with major indexes broadly advancing and risk appetite showing signs of recovery. The SSE Index(000001) rose 1.13%, climbing above all major moving averages. It now stands 25.86% above its one-year low, though still 7.87% below its one-year high.
The CSI 300(000300) edged up 0.88%, maintaining a stable short-term structure. However, trading volume was 20.79% below the 50-day average, indicating lingering investor caution. Growth-oriented stocks outperformed, with the Shenzhen Index(399001) rising 1.42% and the ChiNext(399006) gaining 2.32%—the latter leading for a second consecutive week. Both indexes have reclaimed multiple short- and mid-term moving averages, reflecting improved technical structure.
On the macro front, China’s official Manufacturing PMI rose to 49.5 in May, suggesting a modest recovery in industrial activity. The services sector remained in expansion, with the Caixin Services PMI rising to 51.1. To ease liquidity pressures, the PBOC conducted RMB 1 trillion of reverse repos on June 6, helping stabilize market expectations. On U.S.-China trade relations, the recent call between the two heads of state reaffirmed commitment to implementing the Joint Statement, sending a positive signal and easing tensions.
Hong Kong stocks extended their strong performance, with the Hang Seng Index(HSI)rising 2.27%, marking a five-week winning streak. Technically, the index is well above its 200-day moving average and has rebounded 44.86% from its year-to-date low.
In the U.S. market, the three major indexes posted modest gains and continued to trade near elevated levels. The Nasdaq Composite(0NDQC) rose 0.97%, now 4.48% below its one-year high, maintaining a strong technical posture. The S & P 500 Index(0S&P5) advanced 0.47%, down 3.39% from its one-year high, continuing its weeks-long consolidation near record levels.
U.S. macro data came in weaker. Core PCE rose 2.5% y/y in April, marking the smallest increase in over four years, while consumer spending slowed. May ADP employment increased by just 37,000, the lowest since March 2023 and well below expectations. The ISM Manufacturing PMI dropped to 48.5, contracting for the third straight month and signaling pressure on the manufacturing sector. Meanwhile, former President Trump announced that tariffs on steel and aluminum will be raised to 50% starting June 4, reigniting concerns over renewed trade tensions. As a result, the market-implied probability of a Fed rate cut in July rose to 32.0%, reflecting increased expectations for monetary easing.
From an industry perspective, recent sector rotation has concentrated within the technology chain. The Telecom-Fiber Optics(G3552IG.CN)surged 9.35% this week, with total turnover exceeding RMB 13.5 billion, ranking first among all industry groups. Wholesale-Electronics(G3577IG.CN) and Computer-Data Storage(G3578IG.CN) followed in second and third place, gaining 8.83% and 6.22%, respectively. Capital flows were clearly concentrated in high-tech, high-barrier segments with strong growth narratives.
The Top 33 list delivered a strong performance this week, with an average gain of 5.78% across the group and 28 stocks posting gains. The performance gap among constituents narrowed significantly. T And S Comms.’A'(300570) led the pack with a weekly gain of 30.31%, emerging as the top performer. The company focuses on R&D and exports of optical components, with products widely deployed in global data centers and smart grid applications. It holds an O’Neil Score of 71, an EPS Rating of 99, an RS Rating of 95, and a Group Rank of 55, reflecting alignment between earnings strength and technical momentum.
Overall, the A-share market maintained its rebound trend. Although there were no major policy catalysts this week, market structure continued to improve, with sector rotation becoming more concentrated. In the near term, we recommend maintaining focus on high-quality stocks within the top 40 O’Neil industry groups, particularly those with strong EPS and RS Ratings. If trading volume expands meaningfully, the rebound may have further room to extend.
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published on June 6, 2025