Preface

Engaging in the stock market can be an exhilarating experience, especially when aided by authoritative, timely, and comprehensive analysis reports. Recent market activities have been promising for investors, with continuous surges not only fueling optimism but significantly impacting portfolios. This article delves into the fascinating dynamics of the current bull market and the underpinning factors driving these trends.

Lazy bag

Stock markets are seeing substantial gains with numerous positive developments. Key catalysts include US-China relations and policy changes spurring growth.

Main Body

Recently, the Asian stock markets have been embracing a noticeably bullish sentiment, buoyed by a string of favorable events and policy announcements. The A-share market remains robust, building on its streak of consecutive daily gains. On August 12, the A-share index experienced another upward drive, with the Shanghai Composite Index notching a 0.5% rise, the Shenzhen Component Index increasing by 0.53%, and the ChiNext Index climbing by 1.24%. The trading day concluded with 2,084 stocks marking gains, 60 hitting the upper limit, while 3,167 stocks faced declines.

Investor confidence has notably risen within the brain-computer interface sector, capturing interest due to China's efforts in accelerating industrial innovation. The Ministry of Industry and Information Technology, alongside six other departments, recently issued a directive aimed at technological breakthroughs in this realm by 2027. The plan promises to foster an advanced structural, industrial, and standard framework. Concurrently, diverse policies aim to fortify the growth of this pioneering industry.

Similarly, momentum persists in segments like liquid cooling servers, with companies such as Dayuan Pumps achieving significant share price upticks. Notably, Xinjiang's local stocks also exhibit resilience, riding the wave of sector-wide optimism.

Delving deeper into semiconductor advancements, prime players, including Cambrian with a market value surpassing 300 billion Yuan, have hit new peaks. Behind these moves are rumors of upcoming positive news from several key companies. Additionally, an overarching boost to the market environment stems from US-China relations, with a notable decision by President Trump to extend the US tariff deferral period on Chinese goods by 90 days. This extension presents a critical window, reaching its conclusion on November 12. Furthermore, the US's reconsideration concerning chip sales to China is positively perceived, mitigating fears related to technological rivalries and potential supply chain disruptions.

Analysts like Huaxi Securities have articulated that the current market rally draws from multiple sources, including insurance entities, pensions, public, and private funds as well as household investment funds. The liquidity in the market is rejuvenating, as reflected in the narrowing gap between M1 and M2 growth rates since late September, indicating a warming in consumer and investor appetites. Impressively, margin balances have reached a decade-long high, illustrating the resurgence in retail investor confidence.

The backdrop of an asset allocation shortage signals a preference shift towards equities, pivotal for sustaining the bull market momentum. Projections for the latter half of the year remain bullish, forecasting A-shares to challenge new heights in 2024, led primarily by tech-oriented growth aligned with the 15th Five-Year Plan which remains a policy cornerstone.

Meanwhile, Fosun International saw its stock skyrocket by approximately 20% on August 12, amid media reports suggesting its pending stablecoin license application in Hong Kong—an island where new stablecoin regulations recently came into effect. The Hong Kong Monetary Authority's fresh regulatory directives outline stringent requirements for applicants, necessitating preparations by prospective issuers to submit applications by September 30. Fosun has yet to officially comment on these burgeoning rumors.

Key Insights Table