CSI 300 Dropped by 0.18%
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This week, A-shares continued their attempt at a rebound trend, but the performance of major indices remained weak, reflecting that the market is still in an observation period. The SSE Index(000001) slightly declined by 0.57%, maintaining above the yearly moving average overall, but it was still 8.87% away from its one-year high; the CSI 300(000300)closed down by 0.18%, approaching medium to short-term moving averages, with volume shrinking – Friday’s trading volume dropped by 19.03% compared to the 50-day moving average, indicating an increase in the wait-and-see sentiment among funds. The Shenzhen Index(399001) and the ChiNext(399006) fell by 0.46% and 0.88% respectively, still having a considerable distance from their one-year highs, showing technical weakness.
On the Hong Kong stock front, the Hang Seng Index(HSI) defied the trend this week, rising by 1.1%, outperforming major A-share and U.S. stock indices. Although it did not reach new annual highs, the index has rebounded by 43% from its one-year low, demonstrating relatively stronger performance. This performance was driven by improved policy expectations and inflows of overseas capital.
From a macro and policy perspective, domestic news continues to be positive. The Ministry of Finance revealed that stamp duty revenue from securities transactions increased by 57.8% year-on-year from January to April, confirming a significant rise in market activity. Recently, the People’s Bank of China, the China Securities Regulatory Commission, the Ministry of Science and Technology, and other departments have been vocal about supporting “quality unprofitable tech companies to go public” and “promoting the implementation of the fifth listing standard on the STAR Market,” which could bring policy benefits to mid-cap growth stocks. J.P. Morgan also raised its forecast for China’s GDP growth rate, indicating improved foreign investor sentiment towards the Chinese economy.
In terms of economic fundamentals, China’s total social electricity consumption in April grew by 4.7% year-on-year, continuing a steady growth trend. On the other hand, the U.S. reported a significant increase in EIA crude oil inventories to 1.328 million barrels, with initial jobless claims at 227,000, both indicating moderate economic momentum in the U.S., albeit with some fluctuating indicators. U.S. stocks performed poorly, with the Nasdaq Composite(0NDQC) and the S & P 500 Index(0S&P5) declining by 1.49% and 1.95% respectively, constrained by debt issues and inflation expectations, while tepid U.S. Treasury auctions also weighed on market sentiment.
Industry-wise, the top three performing sectors this week were: Mining-Gold/Silver/Gems(G1040IG.CN) with a weekly gain of 6.13%, as funds refocused on precious metal resource stocks against a backdrop of stabilizing gold prices and rising safe-haven demand, with turnover exceeding RMB 10.9 billion, indicating a clear resurgence in market heat; Retail/Whlsle-Jewelry(G5971IG.CN) followed closely with a weekly gain of 5.25%, although there was a slight adjustment on Friday, the jewelry consumption chain showed robust performance due to boosted holiday spending during the May Day break and recovery in mid-to-high-end consumption; Medical-Generic Drugs(G8064IG.CN) rose by 3.44%, with turnover reaching RMB 21.2 billion, as funds reallocated to undervalued quality pharmaceutical companies amid a slowdown in anti-corruption efforts in the medical sector and marginal improvements in healthcare bidding policies, sustaining industry heat.
The TOP33 list had a slightly weaker overall performance this week, with an average decline of -1.38%, where 15 stocks rose and 18 declined, showing a clear divergence. However, notably, the top-performing stock of the week, Seres Group ‘A'(601127), exhibited extremely strong performance with a weekly gain of 12.38%, standing out particularly amidst market volatility. The company gained significant market attention thanks to the success of its new energy vehicle brand “Wenjie” and recent announcements of AI-powered cockpit upgrades and Huawei’s HarmonyOS integration. Its O’Neil Score was 76, EPS Rating reached 83, and RS Rating hit 85, demonstrating robust fundamentals and fund momentum. With a comprehensive business covering the entire automotive value chain including whole vehicles, engines, and components, coupled with deep technological accumulation, Seres Group is well-positioned to benefit from the high-growth cycle of new energy vehicles, supported by smart electrification trends and local government incentives for auto consumption. Despite the lack of disclosure regarding its Acc/Dis Rating, the concurrent increase in share price and volume suggests heightened fund attention.
Whether this round of rebound can continue will depend on the extent of follow-up funding support. Despite the slowing pace of index gains, policy catalysts and valuation repairs provide room for mid-cap growth stocks. Focusing on the top 40 sectors within O’Neil Industries and selecting high-quality stocks based on O’Neil Scores, EPS Ratings, RS Ratings, and Acc/Dis Ratings remains an effective strategy under current market conditions.
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published on May 23, 2025