The Shanghai Composite Index is expected to see 8000 points, and the Shenzhen Component Index 20,000 points, with logic looking to 2026, Shanghai 8000 points, Shenzhen 20,000 points on 2024.9.28.
The trading volume of the two markets is 2.7 trillion, with 51 billion in the North Exchange, which is normal.
On Thursday, brokerages mobilized in advance, and on Thursday night, SMIC announced its third-quarter report.
So on Friday morning, semiconductors and brokerages opened high, plus everyone had hopes for post-market debt restructuring.
Sentiment was relatively consistent, opening high and then declining.
Previously, our estimated scenario was that on Friday, brokerages would lead the rally, then post-market debt restructuring news would come out, and on Monday, it would fully rally.
However, in practice, there has been a problem that has been troubling me:
Brokerage rally → Index rises → Everyone goes to penny stocks to seek elasticity → Diverts brokerage funds → Brokerages fall → Leads to a general fall in individual stocks → Brokerages can’t rally.
This is a vicious cycle. The most frustrating step in the cycle is the one highlighted in red and bold, which is that people won't buy brokerages; as long as you dare to rally the brokerages, I will immediately sell them and then go to the North Exchange, the ChiNext, the STAR Market, to penny stocks, to pursue 20cm and 30cm big gains, directly leading to fund diversion, and then a general decline.
Breaking this cycle relies on the market in the long term and on regulation in the short term.
In the long term, it relies on the implementation of the 'Nine National Policies' to achieve marketization, for example, after New Year's Day, a few months of performance slaughter will greatly improve market chaos.
In the short term, the village still needs to take action. Over the weekend, three companies were investigated: Chuangxing Resources, Yuanxing Energy, and ST Bailing; Hao Ao Bo has been suspended for review (7 stocks with 20cm, excessive). Five companies received letters: Dongwu Securities, Changjiang Securities, Shennong Agriculture, Straits Shares, and Zhengping Shares.
Therefore, tomorrow, high-position targets will experience a wave of panic selling.
The released funds will rationally return to value points.
Overall, brokerages and semiconductors have a great opportunity to recover tomorrow and will lead the mainstream next week.
Unfortunately, over the weekend, the giants did not release heavy policies, probably afraid of adding fuel to the fire, so let's wait and see.
There are less than 40 trading days left until the end of 2024.
Funds will gradually return to performance stocks, growth stocks, and value stocks.
Targets that are being speculated at high levels will face some difficulties in the future.
There is nothing to modify regarding the previous macro logic, micro rotation order, and predictions.
By the way, I will attach the forecast for sector rotation on October 29.
