The A-share market is about to change? The major sectors that performed best last week are all falling today! This new theme has set off a tide of price limits

On April 22, the market fluctuated and adjusted throughout the day, and the Shanghai Composite Index led the decline. At the close, the Shanghai Composite Index fell 0.67%, the Shenzhen Component Index fell 0.43%, and the ChiNext Index fell 0.32%.

In terms of sectors, military industry, pork, tourism, medical equipment and other sectors were among the top gainers, while oil and gas, coal, gold, flying cars and other sectors were among the top decliners.

Overall, stocks fell more and rose less, and more than 3,300 stocks in the whole market fell. The turnover of the Shanghai and Shenzhen stock markets today was 822.1 billion, a decrease of 38.2 billion from the previous trading day.

Northbound funds bought a small net of 1.389 billion yuan throughout the day, including a net purchase of 908 million yuan in Shanghai-Hong Kong Stock Connect and a net purchase of 481 million yuan in Shenzhen-Hong Kong Stock Connect.

Today's market is quite interesting, and it seems to suggest that change is coming.

On the one hand, the recent outstanding oil and gas, precious metals, coal and other sectors have led the sharp decline, and bank stocks have also performed poorly, resulting in the Shanghai Composite Index performing at the bottom of the three major stock indexes.

In addition, affected by the fall limit of core stocks such as Wanfeng Aowei, the low-altitude economic concept that led the rally last week also performed poorly today.

On the other hand, there are many more "new faces" on today's sector gainers, such as aquaculture, tourism and catering, and beverage manufacturing (liquor stocks) that have been adjusted for a period of time.

An indirect evidence is that the stocks that rose to the limit in the previous trading day fell by 1.2% as a whole today, indicating that the sustainability has been greatly reduced.

The most eye-catching of the "new faces" is the defense industry, which is closely related to the new logic of the weekend fermentation, let's take a look first.

The "information support force" led to the outbreak of the military industry sector across the board

Generally speaking, the flush "national defense and military industry" plate set off a tide of daily limits, and stocks such as Sichuang Electronics and 712 were directly sealed in early trading.

Specifically, concepts such as China Shipbuilding Department, Terahertz, and domestic aircraft carriers have all appeared at the top of the list of gainers.

On 19 April, the inaugural meeting of the Information Support Force of the Chinese People's Liberation Army was held in Beijing. The newly established information support force will be under the direct leadership and command of the Central Military Commission, and at the same time, the number of the strategic support force will be revoked, and the leadership and management relationship between the military space force and the cyberspace force will be adjusted accordingly.

According to CCTV News, Wu Qian, spokesman for the Ministry of National Defense, said that the adjustment and formation of information support forces is a major decision made by the Party Central Committee and the Central Military Commission from the perspective of the overall situation of strengthening the military industry, and is a strategic measure to build a new type of structure and layout of services and arms and improve the system of modern military forces with Chinese characteristics, which is of great and far-reaching significance for accelerating the modernization of national defense and the army and effectively fulfilling the missions and tasks of the people's army in the new era. The information support force is a newly created strategic branch of the armed forces, a key support for the overall planning of the construction and application of the network information system, and plays an important role and responsibility in promoting the high-quality development of our army and winning modern wars.

Some analysts believe that judging from the recent market, sustainable themes are scarce. If the subject of military information can be sustained, it may drive the bullish atmosphere in the market.

The research report of Zheshang Securities pointed out that the information support force will coordinate the construction and application of the network information system; the new arms are expected to drive the demand for national defense informatization, and military communications are an important component; satellite communications will empower the data chain, and the domestic low-orbit satellite constellation will advance steadily.

China Post Securities believes that after the rapid growth of the military industry in 2020~2022, the performance of subdivisions in 2023 will be significantly different, and the structural differentiation will intensify, and it is expected to usher in high-quality development in the future. With the continuous development of equipment technology, new technologies and new products are emerging one after another, and there may be more investment opportunities in new fields and new qualitative combat fields. In addition, as China increasingly moves towards the center of the world stage, arms trade exports are expected to become a new growth point for the military sector.

Other leading themes, such as aquaculture, hotel catering, etc., although there are new catalysts in the near future, are not necessarily the main driving force.

One thing these sectors have in common is that they underperformed last week – after all, last week was dominated by the repetition of themes such as Chinese prefixes, high dividends, gold, oil and gas, and the low-altitude economy.

Therefore, to a certain extent, it can be understood that when the previous wave of leading themes fell into adjustment, the new low-level plates rotated with the trend.

Strong sectors pulled back last week

First of all, the two major sectors of oil and gas exploitation and precious metals are far ahead.

Crude oil and gold futures soared after the attack on Iran on Friday, driving stocks in related sectors to strengthen, but judging from the news over the weekend, all parties gave a low-key approach and lowered the risk level.

Since the situation is not so tense for the time being, these commodity varieties have pulled back accordingly, so today's A-share related sectors are also "falling low". In addition, some analysts said that higher US Treasury yields also put pressure on dollar-denominated gold.

In addition, resource stocks, which were strong in the early stage, have weakened today, and the coal sector is one of them.

On the news side, according to the National Bureau of Statistics, in March 2024, the national industrial raw coal output above the designated size was 399 million tons, a year-on-year decrease of 4.2%, which reduced the market's sentiment towards coal stocks.

Wang Yi, an analyst at Great Wall Securities, pointed out in a recent report that the slower than expected recovery in non-electricity demand after the holiday was the main reason for the decline in coal prices. However, the temperature continued to rise after the holiday, the daily consumption of power plants decreased significantly and the inventory was sufficient, and the market did not accept high-priced coal.

According to the weekly report of Soochow Securities Industry, domestic coal prices have been on a downward trend for two consecutive months since they peaked in late February, which has affected market expectations.

However, there are still many institutions that are confident in the subsequent rebound of coal stocks.

Soochow Securities believes that as May approaches, power companies need to start stockpiling for the "peak summer", and it is expected that power procurement will improve. At the same time, it is expected that the impact of safety supervision at the production area will continue to exceed expectations, and the contraction of supply may lead to a reduction of 100 million tons of raw coal production throughout the year, and the expectation of coal prices remains optimistic.

Changjiang Securities also said that the water level of the Three Gorges has fallen to the level of the same period last year, and there is still uncertainty about hydropower output this year, and it is still optimistic about the rebound of coal prices this year.

Finally, the decline of concepts such as low-altitude economy and flying cars has a greater relationship with the fall limit of the bull stock Wanfeng Aowei.

On the evening of April 18, Wanfeng Aowei answered investors' questions on the interactive platform about "how is the progress of the company that established eVTOL with Tesla", the company said that "it has jointly established a project team with its partners to discuss business plans and investment plans with domestic and foreign technical, operational and management teams, and important progress will be disclosed in a timely manner." ”

However, on April 19, Wanfeng Aowei issued a clarification announcement, and the company paid attention to the market rumors reported by the media that "the company and Tesla jointly established an eVTOL company and have formed a project team", which was untrue. The joint venture company established by the company and its strategic partner in the field of eVTOL is the head office of a well-known global automotive OEM in China, and its name cannot be disclosed due to commercial confidentiality. The company will fulfill its information disclosure obligations in a timely manner according to the important progress of cooperation.

On the same day, Wanfeng Aowei announced that it received a regulatory letter issued by the Shenzhen Stock Exchange. Subsequently, Wanfeng Aowei received the "Decision on Issuing Warning Letters to Wanfeng Aowei and Li Ya" issued by the Zhejiang Securities Regulatory Bureau. The regulator said the company had made misleading statements in response to investors' questions.

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This article is for reference only and does not constitute a basis for trading, and you enter the market at your own risk.

Cover image source: Screenshot of market software

Every reporter Zhao Yun and every editor Peng Shuiping