Title: A-Share Market Opens Lower, Led by Declines in Education, Energy, and Metals Sectors
Date: 23rd July 2023, 10:57:12
The A-share stock market witnessed a lower opening today, with education, energy, and metals sectors leading the decline. The Shanghai Composite Index fell by 0.19%, while the Shenzhen Component Index and the ChiNext Index dropped by 0.14% and 0.18% respectively. Over 2,600 stocks in both cities experienced a decline in their value.
Among the gainers were sectors such as retail, biological products, logistics, and brewing, while education, precious metals, and energy metals were among the top losers.
The energy and metal sectors recorded significant declines, with Tibet Mining, Tianqi Lithium, Hanrui Cobalt, Tianhua New Energy, and Huayou Cobalt falling by more than 1%.
In other news, the lithium carbonate futures contract was listed for trading today. The initial batch witnessed seven trading contracts, with a price limit range of 14% of the listed benchmark price. However, the main contract continued to fall by over 11% as of press time, while the far-month contracts collectively reached the limit.
The education sector also experienced a downturn, with Xueda Education, Kede Education, Entrepreneurship Dark Horse, Rongxin Culture, Quantong Education, Guoxin Culture, and Meiji Jim all recording significant declines.
Conversely, the retail sector remained strong, with the central shopping mall notching up six consecutive boards. Renrenle and Guoguang chains rose by the limit, while Dalian Friendship, Youyou Group, and Hefei Department Store rose by more than 1%.
Analysts at Bohai Securities believe that while the market has priced in changes in economic data, the downside risk of the index is relatively controllable as the valuation approaches the bottom and the transaction volume continues to shrink. They predict that the market’s focus will return to fundamentals, stating that recent policies, especially those aimed at stabilizing the private economy, will provide strong support for the sustainable recovery of the real economy. They advise investors to remain patient and seize mid-term layout opportunities at the market’s bottom.
CICC (China International Capital Corporation) noted that textile, clothing, and jewelry consumption are in a weak recovery stage. Benefiting from the improved retail environment and the low base in the second quarter of 2022, they expect the revenue and profits of clothing and jewelry companies to perform well in the first half of 2023. Looking ahead, they suggest focusing on brand companies with flexible profit margins and textile companies that have yet to respond to order recovery expectations. In the long run, CICC is optimistic about the white horse leader.
It should be noted that the opinions presented in this article are for reference only and do not constitute investment advice. Investors are advised to exercise caution as investment carries risks.
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