Profile of Today’s Market:

China securities market on Thursday plunged again to devour all advance yesterday, which stroke a lot on the market confidence. SSE Index declined by 6.54% and SZSE Index declined by 7.49% and SSE-SZSE 300 Index declined by 7.01%. Although SSE Index did not create the new low, its end at 2748 was the new low at ending. The market today devoured all the advance yesterday and more than 200 stocks declined to limit. It should be noticed that parts of stocks have declined more than advancing yesterday. The market’s technical rebound character yesterday was apparent.

 Key Drivers:

Yesterday, the A-share market rebounded sharply accompanied with various positive rumors. However, the rumors are not materialized. As a result, the stock market shows considerable price correction today. All the sectors drop largely and the market index tumbles. In the international market, the oil prices increased again, leading the US stock market index to decline to the bottom of last three months. The fierce volatility of surrounding stock markets promotes the investors’ desire to reduce share-holding and thus the market index plummets.

 The top-20 large-caps in Shanghai market declined mostly. Petro China (601857.SH) declined over 5% and dragged the index largely. Meanwhile, Industrial and Commercial Bank Of China (601398.SH), Baoshan Iron & Steel (600019.SH) and China Life Insurance (601628.SH) all dumped sharply. For industrial indices, the active selling force spread widely. The industrial indices all lost. Papermaking Index, Architecture Index, Agricultural & Forestry Index, Land Index and Metal Index were the last decliners.

 New share Zhongshan Broad-Ocean Motor (002249.SZ) only rose nearly 8% higher than its issue price on its first trading day. The large shrink of new share growth also shows the weakness of current market. The performances of three new shares on their first trading day are weaker than optimistic expectation of the market, especially Zhongshan Broad-Ocean Motor who is at the bottom of institutional forecast. The market is wrapped in pessimistic mood.

 The hotspot disappeared. The pervious futures concept stock China CIFCO Investment opened low and moved high which brought the active of this section. But the futures section was speculated heavily and lack of results support. The market has no enthusiasm. It plunged sharply during the market slump; those advanced 2% in the morning session closed at down limit.

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