Following the conclusion of the Federal Reserve's interest rate hike, major global capital markets have entered a phase of staged rebounds. After completing a bottoming process last week, the A-share market has continued its recovery, with the index's center of gravity gradually rising. Analysts point out that the short-term rebound window has opened, but after consecutive days of gains, investors should remain alert to potential volatility risks.
On September 21, the Shanghai Composite Index opened slightly higher and fluctuated throughout the morning session, then began climbing in the afternoon and ultimately returned above the descending trend line. The Shenzhen Component Index also opened higher and consolidated, with afternoon volatility intensifying before closing with a bullish doji star. The ChiNext Index and the STAR 50 Index both rebounded to strong resistance levels in early trading before pulling back, with closing gains narrowing noticeably. By the close, the Shanghai Composite Index stood at 3949.91 points, up 0.97%; the Shenzhen Component Index closed at 13730.02 points, up 0.65%; the ChiNext Index closed at 3399.59 points, up 0.8%; and the STAR 50 Index closed at 1657.48 points, up 0.29%.
Although the indices have continued their rebound, capital participation has been less than satisfactory. The combined turnover across the Shanghai, Shenzhen, and Beijing exchanges reached 2.05 trillion yuan, contracting by more than 50 billion yuan compared with the previous trading day. On the sector front, pharmaceuticals, real estate, agriculture, forestry, animal husbandry, and fisheries, as well as coal, led the gains. Only a handful of sectors, including precious metals, batteries, household appliances, and electronic chemicals, bucked the trend and declined.
In terms of individual stocks, the consecutive rebound has boosted market confidence, with a broad advance re-emerging. More than 4,500 stocks closed higher across the market, with a rare occurrence of over 100 stocks hitting their daily limit, while fewer than 1,000 stocks declined. Analysts suggest that the Fed's rate hike last week has been widely interpreted as a clearing of negative news, opening a rebound window for the technology sector as short-term overseas uncertainties have temporarily subsided. Meanwhile, the China-US economic and trade consultations held in New York are viewed by the market as a positive signal, further boosting market confidence and risk appetite.
In the short term, as suppressing factors improve, industry voices are turning more bullish. China Merchants Securities noted that the Fed raised rates by 25 basis points as expected, with the dot plot implying one more hike this year, but this represents the clearing of a negative shock. With no more significant macro variables to contend with in the near term, the market is gradually becoming desensitized and returning to industry-based pricing. China Merchants Securities further stated that domestic August economic data show a pattern of "production marginally recovering, aggregate demand remaining weak, and new versus old growth drivers diverging." The weak aggregate demand has been fully priced in, while structural prosperity remains concentrated in technology and exports. Technology sectors that have fully digested their previous crowding are now seeing capital inflows, and technology heavyweights with earnings support are expected to play catch-up, with the market potentially reaching an inflection point ahead. The A-share market is now embarking on its second phase of recovery.
CITIC Securities pointed out that the macro-level tug-of-war triggered by Middle East geopolitical conflicts driving up oil prices and surging US Treasury yields has been largely settled, with oil prices and long-end US Treasury rates subsequently retreating. With a accommodative domestic interest rate environment and a stable RMB exchange rate, the market's main theme has returned to earnings fundamentals, opening a window for capital to flow back into high-prosperity sectors. Going forward, investors need to continue tracking external disturbances from overseas rates, oil price declines, and the late-October FOMC meeting.
"The market may have a rebound opportunity, but given the pre-holiday effect, end-of-quarter institutional assessments, and cross-holiday risk premiums, the rebound's upside before the holiday may be limited," said Wang Xiaoli, a securities analyst. The Shanghai Composite Index chose to break upward through the upper channel on September 21, and a pullback to confirm the validity of the breakout may follow. The STAR 50 Index has seen its two-day rebound constrained by resistance from the ascending trend line, indicating that capital sentiment remains divided. "Overall, technical pressure and profit-taking after consecutive gains could both trigger index volatility."