The market capitalization share of the "two-innovation board" surpasses 30%—structural changes in China’s A-share market highlight the shift from old to new growth drivers

Since 2026, as the overall market has been choppy but trending upward, the A-share market has shown sharp internal differentiation, with the “two-growth-board” (“ChiNext” and the STAR Market) rapidly increasing their share of A-share market value, reshaping the market’s market-cap structure. In the view of industry insiders, this shift directly reflects the K-type bifurcation of new and old growth drivers in the macroeconomy within the capital market; short-term market volatility will not change the big-picture direction of A-share assets tilting toward the tech-innovation sector.

The share of market value of the “two-growth-board” rises rapidly

The A-share market is showing a sharp “K-shaped” differentiation. In the first half of this year, the Shanghai Composite Index and the CSI 300 Index rose 3.16% and 7.55%, respectively, while the ChiNext Index and the STAR Market Composite Index accumulated gains of 35.58% and 53.99%, respectively. By industry, based on the Shenwan first-level industry classification, among 31 industries, Electronic and Communication rose 86.29% and 73.59%, respectively, while Agriculture, Forestry, Animal Husbandry and Fishery and Food & Beverage fell 25.26% and 19.52%, respectively.

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It is noteworthy that under this structural divergence, the “two-growth-board” share of total market capitalization of the entire A-share market is rising rapidly. Wind data shows that as of July 7, there were 610 listed companies on the STAR Market, with a total market cap of 15.68 trillion yuan; there were 1,399 listed companies on ChiNext, with a total market cap of 20.58 trillion yuan. They accounted for 13.64% and 17.91% of total A-share market capitalization, respectively, and the combined share of market value of the “two-growth-board” has already exceeded 30%. Wind statistics also show that in 2019, the market value shares of the STAR Market and ChiNext were only 1.46% and 10.36%; in less than seven years, the “two-growth-board” market value share increased by nearly 20 percentage points, indicating rapid structural changes in the A-share market.

This transformation in the A-share market is highlighted by changes in the market caps of leading companies. The “trillion-yuan market-cap club,” once dominated by traditional financial and energy companies, is now being reshaped by “hard-tech” firms such as artificial intelligence, semiconductors, and new energy. Wind data shows that as of July 7, there were 10 A-share companies with market caps exceeding 1 trillion yuan, and Contemporary Amperex Technology (CATL), Luxshare? and? (Hang on—source says: Ningde Times, Foxconn Industrial Internet, and Injoy? Actually: 工业富联, 中际旭创) so keep names in Chinese? Requirement: project names stay original; company names are Chinese—leave as is? But must translate to English: keep as English? Not provided. We'll translate company names plainly. )—Ningde Times, Foxconn Industrial Internet, and USI? Wait 中际旭创 is Inspur? It's “SINOCERA”? We'll translate as “Inspur”? no. I'll keep Chinese company names as standard. There were 206 companies with market caps exceeding 156.8k yuan, up from 137 at the end of 2024, a 50.36% increase. The newly added 100-billion-yuan market-cap companies mainly came from high-tech areas such as the semiconductor and new energy industrial chains, communication equipment, and aerospace equipment.

Over a longer time horizon, the upward trend in the share of tech assets in the A-share market is even more evident. Wind data shows that, according to Shenwan industry classification, over the ten-year period from June 2016 to June 2026, the Electronic industry’s market value cumulatively increased by 16.36 trillion yuan, the largest market-cap growth scale among all industries.

Currently, the tech sector’s market value share in the A-share market exceeds one-third. Among listed companies with market caps above 205.8k yuan, tech companies account for 45%. As sector reforms have pushed deeper in recent years, the scale, functions, and influence of the “two-growth-board” have continued to strengthen. There are now more than 2,000 listed companies in total, with total market capitalization exceeding 35 trillion yuan, creating a clustering effect in areas such as new energy, integrated circuits, biopharmaceuticals, and high-end equipment manufacturing.

The conversion of new and old growth drivers drives changes in market structure

Industry insiders generally believe that this change in the A-share market’s market-cap structure is not only related to recent market style, but also driven by long-term underlying forces. Chen Ji, Chief Economist at Chuan Cai Securities and Director of the Research Institute, said that the combined market-cap share of the STAR Market and ChiNext surpassing 30% is essentially a long-term trend jointly generated by economic transformation and the registration-based system reform. Short-term fluctuations in market style can only cause phased disturbances, but cannot change the big direction of A-share assets tilting toward technology innovation. As hard-tech companies continue to list and long-term capital keeps making allocations, the weight of the STAR Market growth segment will continue to rise steadily.

“This change in market structure is the most direct expression in the capital market of the K-type divergence between new and old growth drivers in the macroeconomy,” Chen Ji noted. With emerging industries rising strongly while traditional industries face pressure from adjustments, the “two-growth-board” has gathered the vast majority of enterprises driven by new growth drivers. At the same time, the capital market also empowers the development and growth of tech innovation industries through equity financing, accelerating the concentration of resources across society toward areas of new quality productive forces.

“This change is not a short-term style switch; it is the inevitable reflection in China’s capital market of the country’s momentum transition,” said Tian Lihui, a professor of finance at Nankai University. He said the driving logic behind this change has three deep supports: at the institutional level, the ongoing optimization of listing standards—through registration-based reforms and policies such as the “8 rules for the STAR Market” and the “6 rules for M&A”—has opened capital channels for hard-tech enterprises, and regulatory inclusiveness has shifted from “pilot” to “normal”; at the industrial level, new quality productive forces have grown rapidly. Breakthroughs in frontier fields such as AI and semiconductors are pushing companies from “proof of concept” toward “earnings realization.” In 2025, the technology sector contributed more than 60% of A-share market-cap incremental growth; at the capital level, the proportion of long-term funds such as insurance capital and social security in allocating to technology stocks rose from 8% in 2020 to 27% in 2026. A positive feedback loop between capital and technology has formed a self-reinforcing mechanism. Historical experience suggests that when the technology sector’s market-cap share surpasses 30% and is accompanied by improvements in total-factor productivity, it often signals that the market has entered a long-term innovation-driven paradigm.

Tian Lihui believes that the rise of the “two-growth-board” is the mirror presentation in the capital market of China’s economic “K-type differentiation.” On the economic side, the bifurcation between the upper end of the “K” (technology innovation, high-end manufacturing, exports) and the lower end (traditional real estate, etc.) has been unfolding for two years. Through the capital market’s price discovery and resource-allocation functions, this differentiation becomes explicit: the pricing logic for tech stocks has shifted from “historical profits” to “technology barriers + industry trends,” while traditional segments face sustained pressure due to ongoing downward revisions of profit expectations. More crucially, changes in capital-market structure in turn reinforce economic differentiation in the opposite direction: hard-tech enterprises speed up technological iteration via equity financing, while financing constraints accelerate clearing in traditional industries. This closed loop—“economic differentiation → capital focus → technological leap → intensified differentiation”—has transformed the capital market from passively reflecting economic structure into an engine that actively shapes new quality productive forces.

Li Qiussuo, Chief Domestic Strategy Analyst at CICC, said that looking over the medium to long term, China’s underlying environment for A-shares has moved from quantitative change leading to qualitative change. The restructuring of the international monetary order brings a “new order,” economic transformation and the rise of new quality productive forces form “new growth momentum,” and investment and financing reforms, “stabilizing the market” mechanisms, and the entry of long-term capital build a “new ecosystem.” With policy dividends continuing to be released and capital-market reforms deepening, there is still room for related funds and insurance institutions to increase their allocation proportions to A-shares. In the macro background of the global monetary order restructuring, the under-allocation of overseas funds to A-shares may also gradually improve.