[Focus Review] The Shanghai Composite Index shrank in volume and adjusted, testing the 3,900-point level, with the overall hard technology sector under pressure, and the pork concept emerging as a surprise leader.

Does the pig meat concept’s counterattack reflect market risk aversion preferences?

Cailian Press, April 2nd — Today, 28 stocks hit the daily limit, 18 stocks broke the limit, with a limit-up rate of 61%. Jin药药业 hit five consecutive limits, Xinghui环材 reached 20cm3 for three consecutive days, Xinzhong港 and通达股份 hit three consecutive limits, Xin能泰山 hit 6 limits in 8 days, Zhongli集团 hit 6 limits in 10 days, Dadong南南 hit 4 limits in 6 days, Shuanglu药业 hit 4 limits in 7 days. The market fluctuated and adjusted throughout the day, with the ChiNext Index and STAR 50 Index both falling more than 2%. The combined turnover of the Shanghai and Shenzhen markets was 1.84 trillion yuan, shrinking by 169.5 billion yuan compared to the previous trading day. On the market, over 4,300 stocks declined. In terms of sectors, oil and gas services, breeding, coal, shipping ports led the gains; computing power leasing, AI applications, semiconductors, and precious metals sectors led the declines; at the close, the Shanghai Composite fell 0.74%, the Shenzhen Component Index dropped 1.6%, and the ChiNext Index declined 2.31%.

Popularity and Consecutive Limit Stocks Analysis

Recently, the sentiment and the rate of stocks hitting consecutive limits show a continued negative correlation with index fluctuations. As the market falls into a broad decline, the rate of stocks advancing to higher limits has unexpectedly risen to 80%. However, apart from the popular medical sector stock Jin药药业, which hit five consecutive limits, most of the other stocks with 2 limits advancing to 3 are mainly speculative small-cap stocks with independent logic. Yesterday, the rate of stocks hitting the first limit that advanced to higher limits dropped to only 4%, and the next-day premium of low-priced rebound stocks remains sluggish. As major global indices enter correction, the growth sector that experienced a broad rally yesterday faces renewed pressure. The sharp correction in semiconductors and computing hardware sectors has caused the STAR Market to lag again. Aside from the medical sector, sectors like military industry and breeding show counter-trend activity, reflecting the current market’s heightened risk aversion sentiment. The sharp rise in international oil prices has once again triggered a rebound in energy and chemical sectors, and the green energy industry chain, with its energy substitution attributes, has also seen partial inflows. However, market caution toward previously high-traffic stocks remains, which is not conducive to the overall recovery of some previous hotspots.

Mainline Hotspots

The escalation of Trump’s conflict remarks led to a significant jump in international crude oil futures during the Asian trading session, with Brent and WTI crude futures both rising over 6% intraday. Previously, the oil and gas industry chain, which had undergone deep correction, staged a comeback. Beiken Energy, Lanyan Holdings, and CNOOC Engineering hit the daily limit, with shipping leader COSCO Shipping touching the limit mid-session, reaching a new historical high. Kolike股份 closed up more than 15%. As the market’s previous hopes for easing expectations have been dashed, the reshaping of the global energy supply chain has shifted from trading expectations to actual trading realities. Therefore, the short-term surge in international oil prices may not sustain the boost to the energy and chemical sectors driven by sentiment. The chemical sector has shown ongoing divergence recently, mainly due to the high uncertainty of how much many chemical companies benefit from the current energy crisis. Many high-level popular stocks have already overextended their gains based on high oil price expectations. Consequently, the probability of a large influx of short-term funds into the entire energy and chemical sector remains relatively low.

On April 1st, Eli Lilly announced that the U.S. Food and Drug Administration (FDA) approved the oral small molecule GLP-1 receptor agonist Foundayo™ (orforglipron) for market launch. Supported by multiple recent positive factors, the innovative drug concept continues to be in the spotlight. Jin药药业, with its high limit, advanced to five consecutive limits in a straight line. Heavyweight weight-loss drug concept stocks, such as Zhongyao控股, hit the daily limit all day. High-traffic stocks like Meno华 launched counter-moves, and trend-leading stocks San Sheng Guojian, Xinlitao, and Wanbang德 continued to hit new historical highs. As the innovative drug sector maintains high momentum, low-priced stocks like Peking University Medical and Yibai Pharmaceuticals advanced to two limits, while HeFu China and Jimin Health hit the daily limit in the afternoon. Similar to the green energy sector earlier, the emergence of low-priced rebound stocks within the sector is conducive to high-priced stocks continuing to expand upward. Additionally, some event-driven low-priced niche stocks are also likely to attract rebound funds, and the potential for some previously lagging high-quality stocks to rebound remains promising.

The China Passenger Car Association states that lithium battery exports reached $14.2 billion in January–February 2026, an increase of 46%. Meanwhile, Zimbabwe reiterated its stance to maintain the mineral export ban. The lithium concept, after two days of correction, regained capital inflows. Sichuan Energy, Tibet Mining, Ganfeng Lithium, Tibet Urban Investment, and Rongjie股份 surged and hit the limit. Although domestic lithium carbonate production has increased, boosting social inventories and affecting spot prices, downstream lithium battery production in April has also slightly increased compared to March. The rising demand for energy storage still benefits the entire industry’s cost transfer downstream. Therefore, not only lithium salts but also separators, electrolytes, solvents, and other segments are expected to see performance elasticity from rising demand this year. However, as a heavily institutionally-backed large-cap sector, the current lack of trading volume is unfavorable for sustained sector-wide rallies. Internal segment rotations may still be the main theme.

Data shows that in February, China’s fiber optic exports reached 3,779.9 tons, worth 790 million yuan, up 63.6% and 126% year-on-year, respectively. The fiber optic concept remains highly popular. Industry leader Changfei Fiber hit the daily limit and continued to set new highs, with total market value surpassing 200 billion yuan. Tefa Information and Hengtong Optoelectronics also refreshed their historical highs. The daily limit of low-priced stocks like Huiyuan Communications and Huamai Technology, along with new low-priced stocks like Xin能泰山 and Zhongli集团, reflecting a strong speculative atmosphere in this sector. Major institutional funds heavily favor large-cap leaders within the sector, indirectly encouraging short-term speculative participation in low-priced stocks. Compared to the recent price increases in optical fiber, upstream optical rod materials have seen a faster rise recently. On one hand, capacity shortages of optical rods still constrain downstream expansion; on the other hand, companies lacking self-produced optical rods have weaker bargaining power. Therefore, the pure speculation in the entire optical fiber and cable sector remains unlikely to become the norm this month.

Market Outlook

Against the backdrop of mixed external news, the current market remains highly volatile, dominated by sentiment. The market shifted from yesterday’s broad rebound to today’s broad decline, with over 4,300 stocks falling again, increasing operational difficulty for ordinary investors. Although the rate of stocks hitting higher limits has risen sharply to 80%, the number of stocks hitting limits today has halved compared to yesterday. Short-term active funds are concentrated in a few high-valuation small stocks driven by sentiment, reflecting the overall low profitability of the market. From the index perspective, the previously resilient ChiNext Index has again broken below the six-month moving average, with daily MACD and KDJ both turning downward. Therefore, it is advisable to avoid some previously resilient but underperforming stocks.

Today’s Limit-up Analysis Chart

(Cailian Press, Jin Haoming)