On the first trading day after the National Day holiday, A-share market movements did not carry over the pre-holiday sentiment.

As of today's (October 8) close, the Shanghai Composite Index fell 0.79%, the Shenzhen Component Index dropped 2.07%, the ChiNext Index declined 3.15%, and the STAR 50 Index tumbled even further by 4.82%, with more than 3,700 individual stocks across the market closing lower.

What is more noteworthy than the index declines is the shift in capital flows behind the day's 1.68 trillion yuan in trading volume.

The semiconductor sector saw a single-day net outflow of 15.985 billion yuan, telecommunications equipment saw a net outflow of 9.731 billion yuan, while banking and battery sectors bucked the trend to attract capital inflows.

Tech stocks became today's biggest source of capital drain.

"Stock king" Lianxun Instruments plunged 8.19% to close at 1,420 yuan, touching an intraday low of 1,370.1 yuan, with its market value evaporating nearly 19 billion yuan from its pre-holiday closing price.

The A-share market's second-highest-priced stock, Yuanjie Technology, closed at the 20cm limit-down at 1,290.4 yuan.

Changguang Huaxin and Dongshan Precision also hit limit-down, while Shijia Photons dropped over 17%.

Looking overseas, the trigger for this round of tech stock correction was two "black swans" that emerged during the holiday.

The first was the surge in US Treasury yields.

During the National Day holiday, 10-year and 30-year US Treasury yields climbed to 5.36% and 5.73% respectively, hitting 22-year highs.

The surge in risk-free rates diminished the appeal of A-share high-valuation tech stocks.

With capital able to easily earn stable interest of over 5% overseas, A-share tech stocks trading at hundreds of times price-to-earnings ratios and whose share prices rely on future expectations appeared too risky, making this sector the primary target for capital reduction.

The second was a potential sector-level negative.

On October 1, Morgan Stanley released a research report on US Federal Communications Commission (FCC) policy, stating that the FCC plans to restrict China's optical modules.

This news affected sentiment in the AI computing power and optical communications sectors, which had recently attracted concentrated capital.

Optical module leaders such as "Yi Zhong Tian" (Eoptolink, Zhongji Innolight, and Tianfu Communication), which had been heavily favored before the holiday, all experienced capital outflows on the first post-holiday trading day.

Of course, industry insiders analyzed that this rumor came more from overseas institutional speculation, with no official policy text yet seen, leaving room for further maneuvering.

The recent weekly trend of the 10-year US Treasury yield, from East Money.

The more critical signal is that capital has not left the market but is repositioning.

The solid-state battery concept surged against the trend, becoming one of the biggest highlights on the board.

Liwang Shares hit the "30cm" limit-up, Jinyinhe rose over 17%, and multiple stocks including Fengyuan Shares, Xiongtao Shares, and Chuanyi Technology hit limit-up.

Just before the National Day holiday, the Ministry of Industry and Information Technology and six other departments jointly issued the "15th Five-Year Plan for New Battery Industry Development," proposing that by 2030, all-solid-state batteries would initially achieve large-scale application, and long-life lithium batteries would reach a cycle life of 15,000 times.

The implementation of industrial policy provided capital with a clear investment direction and directly drove this round of gains in the solid-state battery sector.

Since September 29, Chuanyi Technology in the solid-state battery sector has hit limit-up for three consecutive trading days.

Meanwhile, the banking sector strengthened during intraday trading.

During the session, Industrial and Commercial Bank of China briefly touched 8.38 yuan, and Bank of China climbed to 6.83 yuan, both refreshing historical highs, while Bank of Hangzhou also hit a new high.

As of the close, ICBC stood at 8.36 yuan, up 0.97%, with a total market value of 2.9796 trillion yuan.

The 42 A-share listed banks collectively achieved operating revenue of approximately 3.14 trillion yuan in the first half of 2026, up 7.42% year-on-year; combined net profit attributable to parent company shareholders was approximately 1.13 trillion yuan, with a clear trend of earnings improvement.

Additionally, policy support cannot be overlooked.

The central bank today conducted 1.2 trillion yuan in outright reverse repurchase operations, achieving a net injection of 200 billion yuan to maintain ample liquidity in the banking system.

Before the holiday, the central bank "fired four arrows at once," cutting the pledged supplementary lending (PSL) rate to 1.5%, and the mortgage interest subsidy policy for homebuyers officially took effect on October 1.

Zhongtai Securities noted that this mortgage interest subsidy is funded by fiscal spending rather than requiring banks to lower loan rates, so it will not further compress bank net interest margins.

The rationale for the banking sector's rise is no longer just "defensive" but is reinforced by support for stable mortgage lending and expanded credit extension.

Bank of China and ICBC both broke through historical highs on October 8.

On October 8, total trading volume across the Shanghai and Shenzhen markets reached 1.6821 trillion yuan, an increase of approximately 244.1 billion yuan from the last trading day before the holiday.

Combined with market movements, capital flowed out of high-valuation tech stocks into solid-state batteries, banking, and other directions supported by industrial policy or earnings improvement expectations, indicating that capital has not exited but is undergoing a clearly directed structural reallocation.

Entering October, the third-quarter earnings disclosure window has officially opened, and market pricing is shifting from sentiment-driven speculation to performance verification.

CSC Financial, in its latest research report, judged that A-shares have entered an earnings verification period in October, and sectors with high certainty of earnings growth are more likely to attract capital favor.