Rebirth of the Capital Legend

The clock had just struck 9:30, and the stock markets were just beginning to fluctuate, drawing the attention of countless investors.

These are some of the most popular stocks that have garnered significant market attention.

In an instant, trading volume surged dramatically, resulting in sharp fluctuations and intense trading activity.

Among them, the stock 'Huaxin Cement', which attracted the most attention, quickly hit the daily limit within 30 seconds of the official opening, with the number of buy orders reaching over 25 lots. In just a few dozen seconds, the trading volume reached nearly 3 million yuan, indicating a continuous stream of funds chasing the stock.

The stock price of 'Huaxin Cement' hit the daily limit up in an instant.

At almost the same time, several other popular stocks related to the "major infrastructure" theme, which are highly correlated with the stock price trend of "Huaxin Cement", also saw price fluctuations.

The stock price of 'Tianshan Cement' surged to an 8% increase, showing a strong momentum to hit the daily limit.

Shougang Group maintained high-level fluctuations, with intense trading between bulls and bears and a surge in turnover.

Due to its relatively small circulating shares, 'Beijiang Jiaojian' has already been bought up to the daily limit by a large number of funds following the trend, becoming the second stock to quickly hit the daily limit among a group of popular stocks with high attention in the 'major infrastructure' sector.

At the same time, it also became one of the most popular stocks in the early stages of the "major infrastructure" theme.

The first stock to achieve two consecutive limit-up days during the second round of speculation.

The stocks 'Financial Street' and 'Chongqing Development' also surged at the same time, with their share prices reaching a 6% increase. Although the price increase of these two stocks was not as high as that of the others, the number of large buy orders and the overall net inflow of funds from major players were the most active.

As for the 'Oriental Yuhong' stock, which also garnered significant attention and high expectations from investors.

After the market officially opened, the stock did not break upward. Instead, due to its weaker-than-expected performance during the pre-market auction, it was met with concentrated selling by many holders at the opening, causing the stock price to fall slightly.

Amidst the surge in stocks related to these popular concepts...

These are leading stocks in various sectors within the "major infrastructure" theme that are of great interest to investors, such as Conch Cement, Huaguo Construction, Huaguo Railway Construction, Huaguo Communications Construction, Kewan Real Estate, Poly Real Estate, China Merchants Shekou, Gemdale Group, and others.

With bullish sentiment continuing to rise across the entire "major infrastructure" theme.

They also continued to rebound upwards, and the corresponding stocks generally opened higher and continued to rise in the early stages of trading.

Meanwhile, other key market themes at the same time...

The liquor, white goods, pharmaceutical, consumer goods, power, and financial sectors continued to remain stable, either fluctuating slightly upwards or downwards, without any particularly obvious anomalies or significant volume spikes. It seems that many active investment funds in the market have completely forgotten about these sectors.

During the pre-market auction phase, the trend of the "emerging industrial chain" theme stands in stark contrast to that of the "major infrastructure" theme.

The related industry sectors and concept sectors continued their sharp decline after the market officially opened, following the trend of a large gap down during the opening auction. They continued to fall and were hit by a large number of stop-loss orders in the early trading session.

In particular, the film and television media, internet software, and internet applications sectors.

These major sectors experienced a sharp sell-off the moment the market officially opened, further widening the sector index decline to over 2%.

As these sector indices continue to decline.

Along this line, a group of popular 'emerging industry chain' concept stocks, which already performed extremely poorly yesterday, naturally faced even more extreme selling pressure from existing investors. Among them, we saw…

The previously leading stock, 'Huawen Online', opened sharply lower by nearly 9 points and quickly hit the daily limit down within a minute of opening.

The two stocks, 'Guangdong Media' and 'Huawen Media', which had already hit their daily limit down during the pre-market auction, were even less active after the market opened. There was virtually no bargain hunters, and many funds that had placed sell orders at the daily limit down during the pre-market auction were completely ignored.

Stocks like LeTV, Netspeed Technology, Maruda Film & Television, and Quantong Education, all core leading stocks in the film and television media, internet software, and internet application sectors, also fell sharply after the opening bell, influenced by the limit-down moves of many popular small-cap concept stocks.

At the same time, panic selling spread across the three major sectors of film and television media, internet software, and internet applications.

The two major sub-sectors and concept sectors, namely the "smartphone industry chain" and the "new energy industry chain," which originally followed a similar trend to the main board's liquor, white goods, pharmaceutical, consumer goods, power, and financial sectors, were also dragged down by the panic selling in the film and television media, internet software, and internet application sectors. Correspondingly, core stocks and popular concept stocks all began to show a sharp decline.

"The hot stocks in the 'emerging industrial chain' sector are basically locked at their daily limit down." Noticing the dramatic market movements at the start of trading, Zhao Zhiyuan, a member of the "Shandong Gang" (a group of major speculative investors) and a key player in the market, kept a close eye on the market changes and said, "After the hot concept stocks that suffered huge losses yesterday were locked at their daily limit down, it's clear that the panic selling in the 'emerging industrial chain' sector is starting to spread to other sectors. If this continues... the overall bullish sentiment and short-term speculative sentiment in the market will likely decline rapidly. Moreover, the core sector of 'major infrastructure,' which showed a relatively good trend at the start of trading, will probably find it difficult to support the market independently under this decline in sentiment and will likely follow suit. If the 'major infrastructure' sector also can't hold up and experiences a sharp drop, then there's not much hope for today's market performance."

“The ‘emerging industrial chain’ sector has indeed severely dragged down today’s market performance.” Hearing Zhao Zhiyuan’s lament, Zhang Wei responded, “I originally thought that since ‘Huawen Online’ showed some resistance during the pre-market auction, some funds would buy the dip after the market opened, thus creating a bottoming-out rebound and mitigating some of the losses from yesterday’s buying. But I didn’t expect… after the market officially opened, this stock offered no resistance whatsoever and was immediately hammered down to the daily limit by a large number of stop-loss orders.”

“It’s not 'Huawen Online' that’s to blame,” Liang Jiucheng said at this time. “The main problem is that 'Huawen Media' and 'Yue Media' performed too poorly. Also, the performance of the major market indices at the end of the opening auction was a bit problematic. The sentiment in the 'emerging industry chain' sector was already quite bad. Coupled with the fact that the major indices opened below expectations, everyone’s expectations fell back. Naturally, there wasn’t much positive feedback after the market officially opened.”

"This opening scene..." Zhao Zhiyuan continued, "I guess most investors before the market opened didn't expect it, right?"

“Who could have predicted this?” Zhang Wei responded. “Everyone thought that with the strong performance of US stocks last night, which directly hit a new historical high, stimulated by the performance of overseas markets, there would at least be a big gap up today. But instead… apart from the Shanghai Composite Index and Shenzhen Component Index opening slightly higher, the ChiNext Index, Huazheng 500 Index, and CSI 1000 Index opened significantly lower, showing a serious loss-making effect. Who can accept this? So after the market officially opened, many profitable funds and a large number of investors who were planning to cut their losses naturally started to sell off their shares on a large scale when they saw that there were no further expectations. However, I think… although the market sentiment is a bit bad right now, the overall market risk is still controllable. I feel that the index is still unlikely to experience a sharp drop today.”

"The reason the index isn't at risk of a sharp drop is because it's supported by heavyweight sectors heavily invested in by institutions, such as liquor, white goods, pharmaceuticals, power, consumer goods, and finance, as well as by the relatively well-performing 'major infrastructure' related sectors and leading stocks," Zhao Zhiyuan said. "If we remove these, the overall market decline should already be around 1.75%. In fact, if you look at the average decline of all stocks in the market, especially the small and mid-cap stocks that are constituents of the ChiNext Index, Huazheng 500 Index, and CSI 1000 Index, their general decline is greater than 2%. So I think the Shanghai Composite Index and Shenzhen Component Index are indeed somewhat distorted. The index decline is not large, but the actual loss-making effect in the market is still very frightening. I think this is basically no different from the trend of an index crash."

"The main sectors targeted by the sell-off today were indeed small- and mid-cap stocks," Liang Jiucheng said. "However, these stocks had indeed risen considerably in the previous few trading days, so I think today's sharp correction is quite normal. As long as the K-line patterns of the ChiNext Index, the Huazheng 500 Index, and the CSI 1000 Index remain in a bullish trend, then this sharp drop will allow the market's shareholding structure to readjust and consolidate. This may not necessarily be a bad thing for the future market trend. I feel that the 'emerging industrial chain' sector is likely to have a chance to reverse later. However, if this sector rebounds again, the leading stocks in the corresponding concept will definitely change. Given their current trend, it's unlikely that 'Huawen Online' and 'Huawen Media' will be able to make a second wave."

“‘Huawen Online’ and ‘Huawen Media’ must be completely dead, right?” Zhang Wei said. “Yesterday’s limit down and today’s limit down with no volume means that the internal shares are completely trapped. With such an extreme trend, it will be difficult to clear out the internal shares without a month or two of gradual decline and adjustment.”

"That's not entirely true," Liang Jiucheng said. "With such sharp rises and falls, if there are still major funds willing to manipulate the market, investing a large amount of capital to prop up the price can actually lead to a very rapid turnover of shares. However, I prefer a short-term strategy, and it's best to give up on these two stocks. After all, with this kind of 'sky-high to floor-low' pattern, even if funds prop up the price and create a rapid rebound, it's difficult to truly change the trend. Rather than that... it's better to invest in other short-term stocks with higher cost-effectiveness, such as 'Huaxin Cement,' 'Tianshan Cement,' and 'Beijiang Jiaojian.'"

“Speaking of ‘Beijiang Jiaojian,’ this stock is really volatile,” Zhao Zhiyuan said. “Every time the bullish sentiment for the ‘major infrastructure’ theme is good, as long as there is a little guidance from funds, the stock price of this stock will head straight for the daily limit. Moreover, once this stock hits the limit, it rarely falls back down. I feel that if we’re talking about the ‘major infrastructure’ theme, the most suitable stock for follow-up speculation or as a benchmark for market sentiment to create room for growth, ‘Beijiang Jiaojian’ is clearly more suitable than ‘Huaxin Cement’.”

“Yes, the stock ‘Beijiang Jiaojian’ is indeed very active,” Liang Jiucheng said. “Currently, in the ‘major infrastructure’ sector, only ‘Huaxin Cement’ and ‘Beijiang Jiaojian’ have shown strong initiative at the start of trading and are currently locked at the daily limit. If, as market sentiment further declines and the overall market losses worsen, ‘Beijiang Jiaojian’ could dethrone ‘Huaxin Cement’, and in the subsequent speculation on the ‘major infrastructure’ theme, various speculative funds could focus on ‘Beijiang Jiaojian’ and treat it as the core leader. This is not impossible.”

"How do you get 'Huaxin Cement' removed from the list?" Zhang Wei asked.

Liang Jiucheng paused for a moment, then continued, "If 'Huaxin Cement' hits its daily limit and then falls back as the overall market sentiment turns bullish, while 'Beijiang Jiaojian' doesn't, then 'Huaxin Cement' will be outperformed."

"Then the probability of this happening today still exists," Zhao Zhiyuan said. "'Huaxin Cement's' market capitalization is indeed a bit too large, and although the initial surge to the daily limit was decisive, and the follow-up buying was also timely, the overall trading volume was still a bit too large. If the overall market sentiment continues to decline, and the loss-making effect of the 'emerging industrial chain' theme continues to spread to other main sectors, it will be quite difficult for 'Huaxin Cement' to maintain its daily limit."

“I think the main thing to watch is the overall bullish sentiment in the ‘major infrastructure’ sector,” Zhang Wei said. “Currently, although the overall bullish sentiment in the ‘major infrastructure’ sector is declining, the funds following the trend are still barely supporting the market.”

"Let's see how the stock price of 'Oriental Yuhong' performs." Liang Jiucheng's gaze shifted and landed on the stock.

"The stock 'Oriental Yuhong'?" Zhao Zhiyuan was slightly taken aback and said, "It doesn't seem like this stock is the hottest stock in the market right now, nor is it the stock that investors are paying the most attention to, right? I feel that the influence of this stock on the overall trend of the 'major infrastructure' theme is continuously declining. Lao Liang, do you think the trend of 'Oriental Yuhong' stock is still very important to the overall trend and sentiment feedback of the 'major infrastructure' theme?"

Liang Jiucheng replied, "Although the market attention and discussion surrounding 'Oriental Yuhong' have decreased somewhat in the past two days, it is still the leading stock in the 'Major Infrastructure' theme, and even the entire market, with the highest potential. It's also a bellwether for the current 'Major Infrastructure' theme's speculative surge. As long as the stock's internal shareholding structure hasn't completely collapsed, and the 'Fuxing Road' investors who are locked in haven't exited, then the stock's performance will have a significant impact on the sentiment and direction of the 'Major Infrastructure' theme." (End of Chapter)