Iran and the U.S. agree to a two-week ceasefire: A-shares rapidly surge, with these sectors jumping 8%

Ask AI · Why can the U.S.-Iran ceasefire instantly boost confidence in the A-share market?

On April 8, the A-share market saw a sharp rebound.

More than 5,100 stocks rose throughout the day; the ChiNext Index and the STAR Market Composite Index jumped by more than 5%, and the Shanghai Composite Index rose by more than 2%.

In terms of sectors, the Internet Index rose by more than 8%; precious metals and cultural media, among others, rose by more than 7%; engineering machinery, electronic components, computer hardware, software, semiconductors, and others rose by more than 5%. Insurance, environmental protection, education, beverages, and other multi-sectors were among the top gainers; coal and oil and natural gas declined.

On the news front, Xinhua News Agency reported that U.S. President Trump posted on social media saying: “I agree to suspend bombing and attack operations against Iran for two weeks.”

A-share market rebounds sharply, ChiNext up more than 5%

According to Xinhua News Agency, citing reports from multiple U.S. media, under a two-week ceasefire agreement, U.S. airstrikes on Iran have been paused. Israel also agreed to suspend bombing operations during the U.S.-Iran talks.

Before the market opened on April 8, oil prices instantly fell by more than 10%, while gold and silver rose, and U.S. stock index futures surged across the board.

That day, the A-share market opened significantly higher, with more than 5,100 stocks rising and 135 stocks hitting their daily trading limits. By the close, the Shanghai Composite Index rose by 2.69%, and the ChiNext Index surged by 5.91%. Tech stocks rebounded across the board, with sectors such as internet, semiconductors, industrial machinery, and aerospace and defense ranking among the top gainers; gold and industrial metals, as well as the large financial sector, performed strongly.

At the same time, oil and gas and coal stocks saw adjustments. Major state-owned enterprise coal and oil and gas exploration, along with other popular concepts, all fell by more than 2%, and the Oil and Natural Gas Index declined by more than 4%.

“The direct reason for the market rebound comes from the U.S., Israel, and Iran announcing a two-week ceasefire. During that period, the Strait of Hormuz is expected to resume navigation, which reduces concerns about a global oil and gas shortage, pushing oil prices down and bringing the Federal Reserve’s rate-cut expectations back up. Therefore, after the news broke, Asian markets collectively surged.” Xia Fanjie, a strategy analyst at CITIC Securities, said.

He added that in recent days the A-share market had already undergone a significant correction and trading volume had shrunk noticeably. After market sentiment deteriorated, funds were waiting for a bottoming opportunity, and the rebound had already been building momentum. Meanwhile, the domestic “Golden March and Silver April” peak-season effect has emerged: the operating conditions of industrial enterprises have clearly improved. A series of high-frequency data on operating rates also supports the trend of an improving economy, and the improvement in fundamentals similarly helps the market stabilize and rebound.

Fu Jingtao, Chief A-share Strategy Analyst at Shenwan Hongyuan Securities, believes that the period with the highest intensity of the U.S.-Iran conflict has passed. The medium-term macro scenario is now moving toward a key convergence, and the macro risks related to mid-term interest-rate hikes to fight inflation have essentially been ruled out. The previous lows are basically confirmed as the medium-term low point for A-shares. This low point could be both the market bottom and a bottom for the (small-cap growth) style.

Has the worst turning point already passed? Institutions say external conflict has not shaken the foundation of A-shares’ slow bull trend

Regarding the market’s subsequent performance, Fu Jingtao believes that after the medium-term low point appears, the market will revert to the path of a “two-stage uptrend.” “The oscillation and consolidation phase between the two stages of uptrend” will still last for some time. The core is to wait for positive fundamental signals to accumulate, while letting performance and time digest valuations.

In his view, if the industry’s trend makes leapfrog progress, market-structure consensus is regrouped, and profit-making effects plus incremental capital inflows create a positive feedback loop, there will still be a “second stage of the uptrend” in 2026–2027 (possibly starting in Q4 2026). This will be a market in which fundamentals and liquidity resonate, fully opening up the upside space.

Xia Fanjie also said that the situation regarding navigation through the Strait of Hormuz still needs to be tracked. Although a two-week ceasefire has been agreed, there is still a possibility that hostilities could restart. However, the worst turning point has already passed; the market’s concerns about war are beginning to dull. In the next 10 days, the market may enter a period in which risk appetite rises again.

Yang Chao, Chief Strategist at Galaxy Securities, believes that changes in crude oil prices will still be a key variable influencing the structure of the market in the near term. If, under expectations that the conflict will ease, oil prices swing lower and easing expectations for monetary policy recover, it would be beneficial for the repair of growth-stock performance. From the internal environment, policy support, funds entering the market, and the core logic behind the revaluation of China assets remain unchanged. External conflict has not shaken the long-term slow bull foundation of A-shares. At the same time, April is the period when listed companies’ earnings begin entering a concentrated disclosure phase. Market clues gradually shift toward validation of fundamentals. Sectors with high earnings certainty and sustained improvements in operating conditions will become the core focus for capital.

When discussing sectors he favors, Xia Fanjie believes the most benefited directions mainly include three areas: first, AI (optical communications, liquid cooling, chips, etc.) and other high-growth sectors such as new energy; second, themes tied to rising expectations for interest-rate cuts, such as non-ferrous metals (precious metals, small metals) and innovative drugs; third, themes that benefit from rising risk appetite, such as computers, media, defense, and non-bank financials.

Fu Jingtao believes that high-elasticity investment opportunities still come from extending the technology mainline plus expanding the macro narrative. Specifically, in terms of specific directions, in “real-world” technology segments that were strong before the U.S.-Iran conflict, there is still elasticity in the short term. Key focus areas include optical communications, gas turbines, and energy storage. For the subsequent rotation directions, key focus should be on investment opportunities in new energy, new energy vehicles, and the export-chain.

Yang Chao said he still favors the dual main lines in the medium to long term: technology-driven industry catalysts and the price-increase clues of cyclical sectors. Currently, he is more optimistic about three major allocation opportunities: first, as driven by the U.S.-Iran conflict, energy and alternative-demand strengthen, and there is valuation-repair space in sectors including coal, coal chemical industries, new energy, shipping ports, oil and gas, and non-ferrous metals; second, defensive assets such as financials (banks), utilities, and transportation have a staged advantage; third, technology innovation, self-reliance and controllability, and the logic of industry trends being certain, including power equipment, energy storage, storage, semiconductors, computing power, and communication equipment.

Multiple brokerage analysts frankly acknowledged that the subsequent market will still be influenced by multiple factors, including the slow progress of U.S.-Iran negotiations, the restarting of war, and the recovery of the Strait of Hormuz being less than expected.

Beijing News Shell Finance reporter: Hu Meng

Editor: Wang Jinyu

Proofreader: Liu Baoqing