The market experienced a dip followed by a recovery today, closing with all three major indices collectively in positive territory. Capital continued its rotational pattern, with sectors like chips and computing power rebounding, while the gold concept maintained its strong momentum. The total market turnover for the day reached 2.8 trillion yuan, shrinking by over 350 billion yuan compared to the previous session, and the number of declining stocks across the two exchanges exceeded 3,400. Recent market dynamics have been characterized by rapid style shifts. Funds have been flowing back and forth between technology, cyclical, and dividend-paying sectors, as well as between large-cap and small-cap stocks. This volatility may leave some investors feeling disoriented in the short term, potentially leading them to adopt a wait-and-see approach and exit the market. Analysts point to three key variables currently influencing the market: first, the extent to which deleveraging activities in the final three trading weeks before the holiday will impact bullish sentiment; second, whether the relatively full adjustment of large-cap heavyweight stocks, exemplified by the A50 index's nine consecutive negative sessions, will stifle thematic speculation and subsequently dampen the market's赚钱效应 (money-making effect); and third, the potential for "earnings landmines" to be triggered in the last few trading days of January as the earnings disclosure and pre-disclosure period gets underway.
On the market front, the chip sector staged a powerful rebound, with the 200-billion-yuan leader Hua Hong Semiconductor Limited hitting a new historical high. The surge was fueled by news that Micron Technology has officially broken ground on an advanced wafer fabrication facility within its existing NAND flash memory manufacturing campus in Singapore. The company plans to invest approximately $24 billion over the next decade, with production expected to commence in the second half of 2028. Among other hotspots, the commercial aerospace concept regained traction, with stocks like AECC Aviation Power Co.,Ltd and AviChina Industry & Technology Co., Ltd. surging by the daily limit. The precious metals sector continued its strong performance, with Hunan Gold Corporation Ltd. and Shengda Resources Co.,Ltd. among those reaching new historical highs. The computing power sector also showed strength, with stocks like TFC Optical Comm advancing. On the downside, cyclical resource stocks such as coal and steel underwent adjustments, while the pharmaceuticals, biotechnology, and major consumer sectors were among the biggest decliners. Looking ahead, Orient Securities believes that while recent proactive market cooling measures have altered the short-term rhythm, they have not changed the broader market structure, which remains conducive to a rational slow-bull market. They identify the "technology track + resources" theme as the primary investment focus leading up to the Spring Festival.
In terms of individual stock performance, 1,928 stocks advanced, 3,454 declined, and 91 closed unchanged across the two exchanges. A total of 59 stocks hit the upper price limit, while 13 fell to the lower limit. At the close, the Shanghai Composite Index rose 0.18% to 4,139.90 points, with a turnover of 1,289.4 billion yuan. The Shenzhen Component Index edged up 0.09% to 14,329.91 points, with a turnover of 1,605.6 billion yuan. The ChiNext Index gained 0.71% to close at 3,342.60 points.
Today, institutional funds primarily targeted sectors such as communication equipment, semiconductors, and banking. Stocks leading the net inflow rankings included Zhongji Innolight, New Essex, and Foxconn Industrial Internet.
In other key news, China is set to issue a document addressing the impact of artificial intelligence on employment and promoting job opportunities. According to sources, as part of Tokyo's $550 billion investment plan in the United States, Japan and the US are considering jointly investing in a synthetic diamond production facility. Data from the National Bureau of Statistics showed that in 2025, the total profits of industrial enterprises above the designated size nationwide reached 7,398.20 billion yuan, a year-on-year increase of 0.6%. Among these, profits of state-holding enterprises fell by 3.9%, profits of share-holding enterprises dropped by 0.1%, profits of enterprises with foreign, Hong Kong, Macau, or Taiwan investment increased by 4.2%, and profits of private enterprises remained flat compared to the previous year.
Looking forward, Zhongtai Securities believes the short-term divergent market structure is likely to persist, potentially converging gradually in the medium term. As the post-Spring Festival earnings season unfolds, market pricing logic is expected to shift from risk appetite and valuation expansion back to a focus on earnings realization and profit growth. Guojin Securities recommends focusing on the ongoing re-rating of real assets in global portfolios, Chinese equipment export chains with global comparative advantages, consumption recovery channels benefiting from capital inflows, and non-bank financials. Orient Securities reiterates that while recent market cooling has changed the pace, the overarching market structure remains intact, favoring a rational slow-bull trend, with the "technology track + resources" theme being the key investment line before the Spring Festival.