This week, several data points
The Shanghai Composite Index rose by +1.09%, with a fluctuation of 2.66%;the All A-shares Index increased by 2.33%, with a fluctuation of 2.8%;market sentiment scored 59, with an average trading volume of 1.47 trillion.The above data indicates that the overall index environment is quite good.
This week, the Tonghuashun Hot Stocks Index increased by +0.82%, with Monday’s highs suppressed to the third board. The first three days showed a slight upward trend, while the last two days were bearish, with sentiment retreating from a high on Friday.
Overall, the profit-making effect seems insufficient, possibly due to the following three reasons:
1. There are few sustainable themes
This week, around 10 themes have emerged, including robots, PCBs, electricity, photovoltaics, hydrogen energy, financial services, food delivery, real estate, rare earths, and pharmaceuticals.Among these, the most sustainable is the financial services sector, followed by photovoltaics. The other sectors show very average sustainability from a relay perspective, with more focus on food delivery and electricity, which only lasted 1-2 days, with occasional stocks showing independent trends.
2. Sustainable themes are not favored by short-term funds
As the leader of the bull market, large financials only show profit-making effects when the index is strong; otherwise, they are often misleading. Photovoltaics, similarly, have been forgotten by funds due to overcapacity and other factors. In contrast, the previously favored large technology sectors like robots and PCBs have shown poor sustainability; the catalyst for robots was not strong enough, leading to a sharp decline on the opening day, while the PCB trend accelerated before entering a correction.The results indicate that the current market style is not favored by the majority, focusing instead on traditional industries and large financials disguised as anti-involution.
3. Confusion in sector rhythm and stock positioning
Upon closer inspection, large financials have been sustained for 1.5 months, with unclear sector rhythm and confused stock positioning. Compared to financials, photovoltaics have significantly lower strength and sustainability, but their stock positioning and sector rhythm are relatively clearer. These factors collectively lead to uncertainty about how to participate.
How to break the deadlock
On Tuesday, the photovoltaic and PCB sectors resonated, on Wednesday, diversified financials broke through previous highs with increased volume, on Thursday, there was a quick rebound to new highs after a low opening, and on Friday, rare earths transitioned from local fermentation to sector activation. All of these are relatively clean short-term nodes. This retrospective is a form of hindsight, more about finding a reasonable closure for buying points. If one does not believe that this week’s bullish trend can sustain from the beginning, it is fine not to buy into financials.
Tomorrow’s forecast
The current index is highly correlated with financials, with multiple occurrences of divergence between the yellow and white lines during trading. Speculative sentiment and market sentiment are diverging; next week, the previously rising financials may shift to a consolidation phase, replaced by new themes and sectors taking the lead. Recognizing this logic early allows for cleaner starts and moderate relays.
The most discussed topics over the weekend were diversified financials and robots. The first humanoid robot in the country received a large order, which is a more favorable news for the sector compared to the shell listing on Tuesday night. From the market perspective, some core stocks showed unusual movements on Friday afternoon; it remains to be seen whether this time it will strengthen, so we will wait and see.