During the holiday period, we shared with you the basic situation of the recovery of Spring Festival consumption. Although only a few industries such as tourism and movies have reached the level of 2019, the overall performance is still better than market expectations. Before the festival, we mentioned that if the consumption data during the Spring Festival is good, then the funds that flowed out before the festival will be replenished after the festival. Today, the turnover of the two markets has once again increased to one trillion, and it is very clear that funds from outside the market have entered.

Regarding the consumption data during the Spring Festival, there is still a significant divergence between foreign and domestic capital. Foreign capital has further strengthened its optimistic expectations for the recovery of China's economy. Within the first half hour of the morning, it bought more than 10 billion, with a net purchase of 18.6 billion for the whole day, and a net purchase of over 130 billion in January, setting a historical record. However, domestic capital still cannot get rid of the bad habit of gambling. Today, it sold the consumption sector on the good news and turned to attack growth sectors such as automobiles and artificial intelligence.

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Overall, considering the general rise in the peripheral market during the holiday period and the explosive purchase of 18.6 billion by foreign capital today, there are two main reasons for the high opening and diving of A-shares today:

First, historically, when the A-share market is closed and the peripheral market rises significantly, there will often be pressure when the A-share market opens. The reason is simple: when the A-share market is closed and the peripheral market rises, once the A-share market opens and the peripheral market corrects, it will affect the sentiment of the A-share market. Moreover, after the holiday, the market has a strong consensus, and retail investors rush in at the opening, making it easy for the main force to take advantage of the good news to sell, leading to a stock market dive.

Today, the Asia-Pacific market is generally falling, especially the Hong Kong stock market. The Hang Seng Technology Index rose by more than 5% in the two trading days last week, and today it almost gave it back. The Dow Jones futures and Nasdaq futures in the US are also falling, which will undoubtedly affect the A-share market.

In addition, during the holiday, there were reports that the United States and the Netherlands and Japan reached an agreement to restrict the export of semiconductor-related equipment to China. The United States has been quite active recently, and geopolitical competition may intensify. There is also a Federal Reserve interest rate meeting this week, and it is expected that market volatility will increase, and market risk appetite will also be affected.

Second, although the recovery of consumption during the Spring Festival was better than expected, real estate and automobiles were relatively weak. According to data from CRIC Real Estate Research, the transaction volume during this year's Spring Festival decreased by 14% year-on-year, and the decline compared to the pre-epidemic year of 2019 is still more than 30%.

Among them, although the transaction volume in the first-tier cities during the Spring Festival week decreased by 72% year-on-year, it is still significantly better than the same period in 2021 and 2019; the transaction performance in the second-tier cities is slightly worse, with only 71,000 transactions in 9 typical cities during the Spring Festival week, a decrease of 86% month-on-month, and a year-on-year decrease of 28%; the third and fourth-tier cities "turned red against the trend", and the trend of returning home to buy houses has just begun, with a month-on-month decrease of 61% in 28 third and fourth-tier cities.

In the context of the economic recession in Europe and America, this year's economy mainly depends on domestic demand, and housing and cars are the main drivers of domestic demand. If housing and cars cannot recover, relying solely on food and beverage and the service industry will not be sufficient. Next, the recovery of the real estate market will be key.Specifically, A-shares opened higher this morning, with the Shanghai Composite Index once breaking through the 3,300 point mark. However, it then experienced a sharp decline after reaching a peak, falling all the way back and barely turning positive. By the close, the Shanghai Composite Index had risen by 0.14%, the ChiNext Index had increased by 1.08%, the Hang Seng Index had fallen by 2.73%, and the Hang Seng Tech Index had dropped by 4.84%. More than 3,800 individual stocks across the market were up, and the total transaction volume on both markets expanded to 1.06 trillion yuan.

Looking at the sectors, industries such as automobiles, defense and military, computers, power equipment, and food and beverages led the gains, while commerce and retail, coal, transportation, non-bank finance, and real estate led the declines. Among them, the integrated casting of automobiles and the AIGC concept sectors led the gains, mainly stimulated by Tesla's surge and the popularity of the ChatGPT concept.

Risk Warning:

The stock market carries risks, and investment should be approached with caution. This article does not constitute investment advice, and readers should think independently.