The market rebounded following a sharp pullback in the previous session, with the performance of the Shenzhen market notably stronger than that of the Shanghai market.

On June 24th, the three major indices all opened lower and moved higher. The Shanghai Composite Index spent most of the morning session fluctuating in negative territory, finding support and stabilizing near its 10-day moving average. It turned positive in the afternoon, but the rebound was capped by resistance at the 5-day moving average, leading to a narrowing of gains by the close. The Shenzhen Component Index and the ChiNext Index followed a similar trajectory throughout the day, with their gains expanding in the afternoon, ultimately reclaiming their 5-day moving averages.

At the close, the Shanghai Composite Index was up 0.11% at 4110.81 points. The Shenzhen Component Index rose 1.24% to 16051.32 points, and the ChiNext Index gained 1.41% to 4251.42 points. Combined turnover for the Shanghai, Shenzhen, and Beijing exchanges reached 3.3072 trillion yuan, shrinking by nearly 160 billion yuan from the previous session.

Notably, among the major indices, the STAR 50 Index surged 3.82%, driven by strength in the semiconductor sector, continuing to set new all-time highs.

In terms of sector performance, energy metals, semiconductors, chemical fibers, and consumer electronics led the gains. Sectors like agriculture, coal, film and cinema, and tourism were among the biggest decliners. Regarding individual stocks, although the major indices rose, a broad decline in stocks persisted. Over 1,400 stocks closed higher, with 106 hitting their daily limit-up, while more than 4,000 stocks ended the day in negative territory.

Technology stocks strengthened again after a swift correction, with the market's focus remaining on their future trajectory. According to views from several institutions, the tech bull market is not over, but given the substantial gains already seen, a continued divergence in future performance is highly likely.

Key Considerations for Investors

Chen Yuheng, a senior investment advisor at Jufeng Investment Consulting, stated, "After a sustained rally, the overall valuation of the technology sector has reached historically high levels. The share prices of many individual stocks have become severely detached from their fundamentals, relying more on thematic expectations to maintain momentum. As we enter the intensive disclosure period for mid-year earnings forecasts in July, the market's focus will shift from 'speculating on expectations' to 'testing the substance,' with the ability to deliver on earnings becoming the core metric for evaluating stocks."

In fact, the "litmus test" effect of the mid-year reports is already beginning to show. Looking at recently disclosed tech stock forecasts, Changchuan Technology expects its first-half net profit attributable to shareholders to surge by 110.76% to 134.18% year-on-year, while Satellite Chemical anticipates a year-on-year increase of 118.68% to 155.13%. Recent price action shows both of these high-growth stocks have delivered impressive performances.

Market Outlook and Technical Analysis

As for the index's direction, can the rebound from the recent low be sustained? Securities analyst Wang Xiaoli shared her assessment. Wang indicated, "The market rebounded after a rapid release of selling pressure in the previous session, but the strength of the move and the accompanying trading volume were somewhat lacking. In the short term, we believe the market will primarily consolidate within a range, with limited room for significant moves in either direction. However, it's important to note that if technology stocks experience substantial volatility, it could have a significant impact on the ChiNext Index and the STAR 50 Index."