[Daily Market Review] The ChiNext Index fluctuated and declined by 2.7%, with hot sectors like lithium batteries and computing power losing momentum. High-speed rail concept stocks defied the trend and remained active.

Cailian Press, March 31st: The market fluctuated downward, and all three major indexes closed lower collectively. The ChiNext Index and the STAR Market 50 both fell by more than 2%. The total trading value on the Shanghai and Shenzhen markets for the whole day was RMB 1.99 trillion, up by RMB 76.8 billion from the previous trading day. On the trading board, sector hotspots were relatively chaotic, with nearly 4,400 individual stocks across the market falling. By sector, the high-speed rail concept continued to show strength; Shenzhou High-Speed Railway achieved a second consecutive daily limit-up, and Jiying Heavy Industry hit the 20CM limit-up. The commercial aerospace concept strengthened against the trend; Jianjian Shares delivered a fourth consecutive daily limit-up. The innovative drugs direction repeatedly became active; Tianjin Pharmaceutical, and Kailaiying, among others, hit limit-ups. On the downside, the storage chip concept saw a broad selloff; 3ewei Storage, Demingli, and Shanxiang Xinchuang all plunged. As of the close, the Shanghai Composite Index fell 0.8%, the Shenzhen Component fell 1.81%, and the ChiNext Index fell 2.7%.

By sector

The high-speed rail concept rose against the trend; Jiying Heavy Industry, Shenzhou High-Speed Railway, Jinxi Axle, and China Railway Construction all hit limit-ups, while Jiaotong Tiefa, Te Da Technology, and High-Speed Rail Electric showed the largest gains.

On the news front, according to reports, at the Yangtze River’s mouth where it enters the sea, a major project in the “15th Five-Year Plan” period—an iconic project along the river for high-speed rail—is being expedited. The high-speed rail will extend from Shanghai all the way to Chengdu, connecting the three major urban agglomerations of the Yangtze River Delta, the middle reaches of the Yangtze River, and the Chengdu-Chongqing area, stretching for about 2,000 kilometers. The total investment in the along-river high-speed rail is over RMB 500 billion. In addition, according to planning, by the end of the “15th Five-Year Plan” period, China will basically have completed the main “eight verticals and eight horizontals” express railway trunk corridors. The completion rate of the national comprehensive three-dimensional transportation network’s main backbone will rise from the current 90% to more than 95%.

In the afternoon, the motorcycle concept saw unusual movement. Hongchang Technology achieved two consecutive 20cm limit-ups; Qianjiang Motorcycle hit the limit-up. Huayang Racing and Hongquan Technology both rose more than 10%; Zhenghe Industrial, Jiuqi Shares, and others also followed higher. On the news front, Beijing time on March 28, at the World Superbike Championship (WSBK) event, Chinese motorcycle brand Zhangxue Racing won the race with an absolute advantage of nearly 4 seconds, breaking for the first time the decades-long monopoly by international powerhouses such as Ducati, Yamaha, and Kawasaki in this category.

From a market perspective, themes such as high-speed rail and motorcycles are relatively on the margins. The overall sector capacity is small, and the market caps of related targets are generally low. Against the backdrop that mainstream hotspots collectively take a breather and sector rotation slows, such themes have received periodic focus from some active funds. However, because they have limited ability to drive trading-board sentiment and the market’s main storyline, they are still largely positioned as standalone themes driven by events, or those lacking main-storyline-level spillover effects.

Banks rose against the trend; Bank of China and Agricultural Bank of China both rose by more than 3%. Xia Bank, Pudong Development Bank, Postal Savings Bank of China, China Construction Bank, and CITIC Bank showed relatively strong gains.

The “performance scorecards” for the six major state-owned banks—Industrial and Commercial Bank, Agricultural Bank, Bank of China, China Construction Bank, Bank of Communications, and Postal Savings Bank—were all released for 2025. All of them achieved “both revenue and net profit growth,” with a combined cash dividend of more than RMB 420 billion, and in many banks core operating indicators improved quarter by quarter. On the other hand, as market risk appetite keeps declining, the dividend characteristics of bank stocks—high dividend yield and low valuation—have become increasingly attractive to long-term funds such as insurance capital. The logic for allocating to dividend value continues to be strengthened.

Individual stocks

At the individual-stock level, the pharmaceutical sector has continued to remain active. Wanfangde earned four consecutive daily limit-ups in six days, Tianjin Pharmaceutical achieved three consecutive daily limit-ups, and popular targets such as Shuanglu Pharmaceutical, Sutaishen, and Haitai Bio continued to move upward as well. However, it should be noted that sector-internal differentiation among individual stocks remains significant. In the earlier period, core high-end leader Meinuo-na Pharma saw its high-volume surge weaken at high levels. If sentiment retreats further tomorrow, the short-term overall sentiment for the pharmaceutical sector may face noticeable pressure.

Triggered by the successful launch of the Force Arrow No. 2 remotely operated rocket, the commercial aerospace sector strengthened against the trend. Jianjian Shares advanced to a fourth consecutive daily limit-up; Shaoyang Pharmaceutical, Shunhao Shares, and Jili Suoju also hit limit-ups. Although some targets have shown strong continuation recently, under the current “limited supply” game pattern in the market, it is difficult in the short term to simply replicate the sector-wide momentum of January this year. Funds will most likely continue to focus on battling among leading popularity-core targets on the front lines.

Outlook analysis

Today’s market fell back into adjustment again, with all three major indexes closing lower across the board. Among them, the Shanghai Composite Index surged and then pulled back; the 3,900-point level was lost again. Overall, it is still preferable to view the situation as a structure of bottoming through consolidation. By contrast, the ChiNext Index was relatively weaker: at the same time as it fell below 3,200 points with a volume-increasing medium-length bearish candle, it has already retreated to the lower band of the Bollinger Bands. The market now faces an important threshold in the future. In the short term, if it wants to stabilize, it needs not only to hold the lower band, but also to quickly get back above the 5-day moving average. Conversely, if the adjustment continues, the intermediate-term trend may gradually shift into a bearish stance. Looking at the trading board, previously hot tracks such as lithium batteries, solar power, semiconductors, and computing hardware all fell into adjustment, and some high-level popular stocks also showed concerns that tight positioning could loosen. Therefore, when these hot directions’ “money-losing effect” gets repaired is also key to stopping the decline in the future.

Market news focus

1、Ministry of Finance: Total operating revenue of state-owned enterprises in January to February was RMB 19.9k, up 0.2% year over year

Data from the Ministry of Finance shows that in January to February, the total operating revenue of national state-owned and state-controlled enterprises across the country was RMB 12.57T, up 0.2% year over year; total profit was RMB 6,266.2 billion, down 2.0% year over year. At the end of February, the asset-liability ratio for state-owned enterprises was 65.4%, up 0.5 percentage points year over year.

2、After Zhangxue Racing said it won the championship, orders surged within two or three days; bookings are already scheduled to June

At the World Superbike Championship (WSBK) Portugal round, in the SSP class race, Zhangxue Racing 820RR-RS won the championship. This is the first time a Chinese motorcycle manufacturer has won in the SSP class in the history of this category. A sales representative from Zhangxue Racing told reporters that in the two or three days since winning the championship, vehicle purchase orders have already been scheduled for this year’s June.

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