Hexun Information Jiang Linlin: A-shares experience massive surge, what to expect in tomorrow's market?

Will the broader market still be able to keep rising tomorrow? Tomorrow will continue to see volatility with an upward bias, and there are a few reasons for this.

He Xun Information Jiang Linlin’s analysis says: Let’s look at it. First, today’s trading volume has expanded to around 2.5 trillion yuan. It can effectively support the rebound; the activity level of on-exchange funds has increased, which has driven the continuation of the trend. Second, international oil prices have fallen sharply. Brent crude has dropped to over 90 dollars per barrel, easing pressure from domestic imported inflation. Costs for manufacturing in the midstream and downstream sectors are declining, and expectations for profitability have improved.

Third, under the weakening trend of the US dollar index, northbound capital has returned to A-shares with fairly strong momentum, which brings incremental liquidity to the market. Overall, the halt-fire agreement being put into effect has driven an expanded-volume rebound in A-shares. Technology and resources are the main themes at present. The market has shifted from a risk-aversion mode to a recovery trade. The two-week halt-fire period is the market’s buffer phase, and it is also a period for the bulls to press their advantage. Going forward, we still need to track fluctuations in oil prices. If oil prices consolidate within a narrow range, then we can continue to enjoy the current rally.

(Editor: Shao Xiaohui)

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