Every weekend, the securities market will usher in all kinds of news, and this week's securities market is no exception! The A-share market has ushered in two major positive news from the China Securities Regulatory Commission, which are related to the commission rate for stock trading and five measures for the capital market's cooperation with Hong Kong, which will add fresh blood to the A-share market.
In order to better understand the two good news of the CSRC over the weekend, as well as better predict the market trend of A-shares next week, let's take a deep dive, analysis and forecast together.
Good 1: Lower the commission rate for stock trading
The China Securities Regulatory Commission (CSRC) issued the Regulations on the Administration of Securities Transaction Costs of Publicly Offered Securities Investment Funds, which will come into effect on July 1, 2024.
There are two key points in the regulations, namely, to reduce the commission rate of fund stock transactions, and at the same time to reduce the upper limit of the distribution ratio of fund managers' securities trading commissions, and to reduce the relevant fees at the same time, which directly reduces the transaction costs of investors and directly benefits small and medium-sized investors, so that more funds will remain in the secondary market for trading.
Positive 2: 5 measures for capital market co-operation with Hong Kong
In response to the call of the country, in order to enhance Hong Kong's status as an international financial centre, the SFC issued the "Several Opinions" to mention five measures for capital market cooperation with Hong Kong, namely relaxing the scope of eligible products of Shanghai-Shenzhen-Hong Kong equity ETFs, including REITs in Stock Connect, supporting the inclusion of RMB stock trading counters in Hong Kong Stock Connect, enhancing the mutual recognition of funds arrangement and supporting the listing of leading enterprises in mainland industries in Hong Kong.
According to the five capital market cooperation measures for Hong Kong, it will inevitably make A-shares and Hong Kong stocks better connected, which will attract more foreign investment for A-shares, and at the same time improve the status of Hong Kong stocks.
Will A-shares take off next week?
Over the weekend, the China Securities Regulatory Commission released two major positives, which is undeniable, these two positive benefits actually bring fresh blood to A-shares, which is also undoubted, is A-shares really going to take off next week?
Personally, I think that even if there are two blockbuster benefits from the China Securities Regulatory Commission, A-shares will not take off next week, but there are variables about the trend of A-shares next week, and even worry about the trend of A-shares next week, so it is recommended that investors should not be overly optimistic about the market of A-shares next week.
Why do you think that A-shares will not take off next week, and even express concern? It stems from the following factors that will affect the trend of A-shares next week.
First: This week's A-share rush to 3100 points ended in failure, and next week will continue to face the resistance of this level, and it is particularly difficult to take off before the 3100 point mark is broken.
Second: the lack of momentum for the take-off of A-shares next week stems from the lack of volume and energy in Shanghai and Shenzhen, with a total turnover of more than 800 billion yuan, which cannot support the sharp rise. In addition, the market and investors lack confidence, the sector and individual stocks lose money high, and the stock market that lacks confidence cannot rise sharply.
Third: Although the China Securities Regulatory Commission released two blockbuster positives over the weekend, which can bring new funds to A-shares, these two positives are long-term and have little impact on the short-term stock market, so the trend of A-shares will not have much reaction next week.
To sum up, although the China Securities Regulatory Commission issued two blockbuster positives this week, and the positive is long-term and will not have much impact on the short-term stock market, it is certain that it will be difficult for A-shares to take off next week, but beware of the risk of entering a new round of pullback after the failure of A-shares to rush to 3100 points again next week, wait and see.