Shanghai Composite Index Just Reclaimed 4100 Points, Institutions Say A-shares Relatively Safer Than Overseas Stocks

What are the specific aspects of the safety premium of A-shares?

Reporter | Yi Yanjun, Intern Reporter Lin Qianwei

Editor | Jiang Peixia

Around 10:30 a.m. on March 17, the three major A-share indices all rose collectively, with the Shanghai Composite Index returning to 4,100 points, and over 2,700 stocks rising across the market.

Major financial stocks strengthened, Aijian Group hit the daily limit, and Guosen Securities, East Money, Huijin Shares, GF Securities, Compass, Dazhihui, and Wealth Trends followed the rise. Hangzhou Bank hit a record high during trading.

Today, Hong Kong stocks of Yao Cai Securities Financial resumed trading and surged more than 80% at one point. According to 21st Century Business Herald, on the evening of March 16, Yao Cai Securities Financial announced that the tender offer initiated by Ant Group had been approved by relevant Chinese authorities, and the settlement is expected to be completed by March 30. “Ant has always wanted to obtain a brokerage license, and this is considered a fulfillment of that wish.” Previously, some Hong Kong brokerage insiders revealed that Ant has been testing securities functions internally for a long time, and the market may soon see “Ant Securities.”

Innovative drug concept stocks surged, with Jiadan Biotech rising over 10%, Sansheng Guojian up more than 7%, and Rongchang Biotech reaching nearly 7% at a new high. Yuan Dong Biotech, Yuekang Pharmaceutical, and Bibert also followed the rise.

Insurance stocks collectively surged, with New China Insurance up over 4%, followed by China Ping An, China Life, and others.

Green energy concept stocks became active again during the session, with Jiangsu Xinneng hitting the daily limit. Previously, China Huadian Liao Neng hit two consecutive limit-ups, Zhejiang Xinneng rebounded to hit the limit, and Xineng Technology, Energy-saving Wind Power, and Green Power Generation saw significant gains. The power grid equipment sector experienced a short-term rally, with Sanhui Electric reaching the daily limit, and Baobian Electric, China Western Electric, and Siyuan Electric following suit.

The steel sector strengthened, with Anyang Steel, Farsun, and Jiugang Hongxing hitting the daily limit, and Bayi Steel and Shandong Steel also rising.

Institutions say A-shares are safer relative to overseas markets

The potential spread of the US-Israel conflict could trigger a series of chain reactions, such as soaring energy prices and rising global supply chain costs, attracting widespread attention. Tracing the root causes, the passage status of the Strait of Hormuz has become a core variable affecting the global economy.

“If the US-Iran conflict cools down in the short term and the Strait of Hormuz resumes normal passage, the overall impact on the global economy will be limited. If the conflict becomes prolonged, the global economy will face stagflation risks, and asset prices and investment logic may undergo profound changes,” said Luo Zhiheng, Chief Economist and Dean of the Research Institute at Yuekai Securities, in an interview with 21st Century Business Herald.

Luo Zhiheng pointed out that the safety premium of A-shares relative to overseas markets is more prominent, and the market is expected to show strong resilience. In an era of frequent geopolitical events, China’s strong economic, military, and diplomatic capabilities provide security guarantees externally, while internally, a stable institutional environment and a complete industrial production system form the foundation and confidence for long-term optimism about A-shares.

Regarding specific allocation strategies, he recommends focusing on two main directions: assets with improving supply-demand dynamics, strong inflation expectations, and potential earnings recovery—referred to as “HALO” trading targets; and domestically controlled, self-reliant technologies related to domestic computing power, artificial intelligence, energy storage, commercial aerospace, and national defense and military industries. [Details]

Yuesheng Investment Research: Extension of clues on popular thematic companies

(Disclaimer: The content of this article is for reference only and does not constitute investment advice. Investors operate at their own risk.)

Produced by | 21 Finance Client, 21st Century Business Herald