China Stock Market Closed Higher on First Day of June, More Up Potential Could Be Expected

May 28, 2020

China stock market closed higher on the first day of June, with the Shanghai index closed above 2,900 points and Shenzhen Component Index rose more than 3%, and the northward capital inflows exceeded $10 billion throughout the day. The market is expected to continue rise due to the accelerated implementation of domestic policies and the continuous inflow of northbound funds.

The Shanghai stock index rose 2.21% to 2915.43 points; the Shenzhen Component Index was up 3.31% to 11102.15 points; the GEM Index rose 3.43% to 2158.22 points. The trading volume of the two cities reached 761.6 billion yuan, which was a heavier volume than the previous trading day.

The net inflow of northbound funds was 10.486 billion RMB throughout the day, of which the net inflow of Shanghai Stock Connect was 3.99 billion yuan and the net inflow of Shenzhen Stock Connect was 6.496 billion yuan.

In terms of sectors, almost all sectors are going higher, with semiconductors, components, IT equipment, communications equipment and other sectors gaining more momentum.

Technology stocks have exploded in an all-round way. Apple-related concepts, 5G concepts, OLED concepts and other technology-related sectors have risen ahead, and the auto, liquor and brokerage sectors have also been active.

In terms of individual stocks, a total of 3515 shares rose in the two cities, with a 158 share hitting the up-limit and 5 shares hitting the down-limit. Huawei-related stocks outperformed, and 24 related stocks such as Kodak, Jebsen, and Zhongwei Electronics reached the up-limit.

According to the analysis of Dongguan Securities, from the perspective of the market environment in June, the domestic economy has gradually stabilized, and the economy is expected to maintain a recovery pattern in the second quarter. Driven by factors such as the acceleration of domestic policies and the continued inflow of northbound funds, the market is expected to continue to stabilize and stabilize.

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