This week, the A-share market showed signs of recovery. Boosted by improved market sentiment and rising risk appetite, major broad-based indices mostly rose. The ChiNext Index performed the best with a gain of 1.9%, while the STAR 50 Index lagged, declining by 0.1%. Currently, the Wind All-A Index valuation stands at the 85.7th percentile since 2010.
By sector, nonferrous metals, communications, and defense industries outperformed. Among the Shenwan primary industries, nonferrous metals, communications, and defense sectors led with gains of 5.3%, 3.7%, and 2.8%, respectively. In contrast, media, real estate, and personal care sectors underperformed, dropping by 3.9%, 2.2%, and 2.0%.
Key events this week included policy and conference developments. The National Space Administration established a dedicated commercial aerospace division, signaling regulatory support for the industry. Meanwhile, former U.S. President Trump hinted at announcing a new Federal Reserve chair nominee in early 2026.
On the economic data front, China’s November manufacturing PMI rose slightly to 49.2%, while the U.S. ADP employment report showed an unexpected loss of 32,000 private-sector jobs, reinforcing expectations of further Fed rate cuts.
Industry highlights included major state-owned banks suspending five-year large-denomination certificates of deposit, ZTE collaborating with Doubao to launch an AI-powered smartphone prototype, the Zhuque-3 rocket’s successful maiden orbital flight (though its first-stage recovery failed), and Moore Threads’ explosive 500% intraday surge on its STAR Market debut.
Market Outlook: Bullish but Volatile Expectations of a Fed rate cut, global market recovery, and domestic policy optimism supported the market this week. While the broader uptrend remains intact, short-term volatility may increase amid year-end caution.
Defensive and consumer sectors could outperform in the near term, while TMT and advanced manufacturing may lead medium-term gains, especially if liquidity-driven momentum persists. However, a shift to fundamentals-driven trends would favor advanced manufacturing.
Risks include unexpected overseas disruptions, deviations from historical patterns, and sharp declines in market sentiment.