Rebirth of the Capital Legend

"I feel like the major infrastructure sector has reached the point where expectations are being realized, and many profit-taking funds are reducing their positions and locking in profits," said Lao Wu. "In fact, today's trend in the major infrastructure sector, along with the trends of related sectors and a number of leading stocks in core industries, remains quite strong. It could maintain its position in the top tier of market leaders, along with a number of leading core concept stocks in the new energy industry chain. However, judging by the intraday performance of many stocks... and the follow-up by selling funds, this sector lacks initiative.

The reason why this line can maintain a relatively strong situation today.

It seems that this is related to the fact that a number of domestic real estate stocks in the Hong Kong stock market have performed beyond expectations today and have created a driving effect for an overall surge.

Even if you look at the core leading stocks of many industries in the infrastructure sector.

Stocks such as China Construction, China Communications Construction, China New Building Materials, Poly Real Estate, and Gemdale Group, etc., although their stock price performance and intraday trends remained above the flat price, showed a slightly upward trend, and generally outperformed the Shanghai Composite Index and several other major indices.

However, look at the net inflow of large-scale funds.

It can be seen that among the trading volume of these leading stocks in core industries today, especially the large orders that are actively taken over and sold, there are obviously very few large orders that are actively taken over, while there are relatively many large orders that are actively sold. It can be said that... a lot of funds gathered in this line have shown signs of profit-taking.

It’s just that this is driven by the Hong Kong stock market.

The following sentiment of the small internal capital groups in the main line of large-scale infrastructure is still relatively strong, and they have temporarily taken over the large-scale profit-taking capital groups that are selling.

However, this carrying capacity will continue to decline as market sentiment continues to decline.

That will quickly wear out.

After all, when the money-making effect of the market is declining, many people who originally wanted to buy funds will naturally hesitate.

As more and more people hesitate, the amount of main buying funds flowing into the market to take over will become less and less.

As the amount of main buying funds decreases, more profit-making funds in the market who realize this will naturally increase their selling efforts.

This will lead to increased adjustments in the subsequent major infrastructure projects.”

"Yeah, I agree." Xu Qiao said, "I also feel that the initiative of the major infrastructure line is a bit weak today, and the capital flow performance of the major core leading stocks is also a bit problematic. In fact, if the real estate sector of the Hong Kong stock market had not exploded today, the adjustment of the major infrastructure line would have been more severe today, and the profit-taking selling pressure would have been more obvious.

Moreover, Oriental Yuhong is a stock that is hailed as the core leader of the main line of large-scale infrastructure.

After two consecutive days of sharp rise, it has deviated too much from the previous 5-day line support, and the 10-day line position is too far away. From a technical perspective, if it deviates too much from the previous moving average trend, this stock also has a need for sideways fluctuations and needs to get closer to the previous moving average trend.

Otherwise, the internal chips cannot be further traded and the chip platform cannot be further settled.

If it continues to go up, the selling pressure will only increase.

For now, the only stock worth mentioning in today's major infrastructure sector is the "Beijiang Communications Construction" stock, which still maintains a relatively aggressive leading trend and has not yet shown any obvious downward adjustment.

We have to admit that this stock has an active stock nature due to its small circulating volume, clean chips, low market capitalization.

In the case that Huawen Online, the previous leading stock and the current highest short-term stock in the market, has broken its trend and fallen into a limit down state.

The stock of Beijiang Communications Construction is still trading well today after sufficient turnover.

Actively pull up the template and directly close the daily limit without hesitation. It is indeed very proactive.

It's clear that some of the market's capital groups, as well as a large number of aggressive short-term retail investors, are trying to establish this stock as a new market leader, break through the previous rally in Huawen Online, and rekindle the market's short-term speculation.

"However, it is expected that the major infrastructure sector will also enter a period of concentrated selling by profit-taking and an adjustment trend as the hype in major sectors ebbs. Even if Beijiang Communications Construction has shown sufficient initiative in today's market performance and successfully secured a position in the 'Huawen Online' stock, temporarily becoming the best-performing and most proactive core leader in the entire market..." Lao Zhang thought for a moment and took over the conversation, "Then, with the overall situation and the sector continuing to decline, it will be difficult for Beijiang Communications Construction to continue to strengthen independently, right? It is likely that it will eventually be affected by the trend of the sector index.

Generally speaking, the formation of a monster stock still needs to resonate with the sector.

If the hype in the sector has reached its final stage, profit-taking in the market has already begun concentrated selling, and the trends of a large number of industry-leading stocks are further diverging.

So, let’s look at the sector concept leaders that are temporarily showing initiative.

It is likely to be difficult to get out of it.

I estimate that the stock of Beijiang Communications Construction will most likely open at a high premium tomorrow, but that's all. If this stock wants to continue to hit the daily limit tomorrow, the sentiment in the major infrastructure sector and the overall market sentiment must improve. Obviously... the market trend tomorrow will most likely not be very optimistic.

Compared to Beijiang Communications Construction, I actually think that within the new energy industry chain, Tianci Materials, which is also quite proactive today, has the potential to become a new market leader, leading the entire new energy industry chain to a sustained upward breakthrough trend.

"I've also noticed Tianci Materials," Old Wu said. "Today's trend shows some positive momentum, and the market cap is moderate, so the stock is quite active. However, this is only the first daily limit, so how this trend will continue remains to be seen. It's a bit premature to compare this stock with Beijiang Communications Construction, isn't it?"

Lao Zhang, as you just said, it is difficult for individual stocks to undergo a sustained divergence and breakthrough trend with the sector index and most stocks within the sector.

This is indeed the case.

But if a stock can form a highly concentrated speculation among various short-term capital groups in the market.

At the same time, the strong medium- and long-term expectation logic in the main field in which it is located is valid, and future expectations are still continuing to improve, and there is no lack of corresponding favorable support.

So, when this stock becomes the core hot leader that attracts the attention of the entire market.

In fact, it can break away from the sector, even the main line, and the index performance trend to form an independent breakthrough trend.

Of course, it would be better if the main sector's market conditions could continue to cooperate.

Moreover, in addition to the logic of large-scale infrastructure, there are other logics for the Beijiang Communications Construction stock, such as the revitalization of the Northwest from the macro-policy perspective... In general, as the trend of the Beijiang Communications Construction stock has not shown any signs of decline and there are no signs of a retreat in capital, I think it is still not appropriate to be bearish.

Today, the stock of Beijiang Jiaojian (北疆交建) actively surged to its daily limit. The consensus is that it's trying to outmaneuver Huawen Online (华文在线).

Since there is consistency in expectations, as long as the overall sentiment of the subsequent major infrastructure line does not collapse too badly, I think it will not be difficult for the Beijiang Communications Construction stock to continue to break upward and continue to form a trend of concentrated speculation by short-term capital groups.

As for the stock of Tianci Materials...

I am also optimistic, but I feel that this stock still has some distance to go before it can become the core leader of the market.

Moreover, the current market popularity and attention of Tianci Materials' stock are still relatively average. If the new energy industry chain line enters a relatively large divergent trend adjustment tomorrow like the main line of the emerging industry chain today, it is still unknown whether Tianci Materials' stock can continue to move forward and independently hit the daily limit. Moreover, even if this stock continues to strengthen independently and hit the daily limit tomorrow, it will still have to undergo another test before it can have the potential to become the core leader of the two markets.

In general, at this stage, Beijiang Communications Construction's stock is definitely more certain."

"Yeah, I agree," Xu Qiao replied. "I'm also more inclined to believe that Beijiang Communications Construction's stock has a greater chance of performing well. Brother Chen...what do you think?"

Brother Chen thought for a moment and said, "Both stocks should have opportunities. In fact, for Beijiang Communications Construction, there is another factor that has contributed to its success and attracted a large number of short-term investors. You didn't mention it, and that is the main theme of the Hong Kong stock market, the infrastructure, especially the trend of the real estate sector.

Indeed, at the current stage, the internal profit-taking chips in the major infrastructure sector are loosening.

Many profit-taking capital groups that intervened in the early stage can no longer hold back and want to cut profits, reduce positions and withdraw.

However, the recent performance of mainland real estate stocks in the Hong Kong stock market, and indeed the performance of the entire real estate sector, is actually somewhat abnormal compared to the mainland market."

"What do you mean?" asked Lao Zhang.

Brother Chen paused and continued, "Logically speaking, the Hong Kong stock market's domestic real estate stocks, especially the real estate sector, started to move earlier than the mainland market, and the trends and developments of many domestic real estate stocks are also ahead of the mainland market. Based on the technical trends, many domestic real estate stocks in the Hong Kong stock market should have entered the adjustment phase a long time ago, but the current trend... is clearly accelerating.

When prices generally doubled, not only did they not adjust, but they continued to accelerate.

What does this show?

This shows that more and more capital groups are pouring into this line, and it also shows that the future expectations of this line are continuing to ferment and rise.

Otherwise, there is no reason for a lot of funds to be taken on on a large scale at such a relatively high level.

After all, this is not a bull market.

In addition, the nature of the funds of these groups guiding Hong Kong-listed domestic real estate stocks is also questionable.

But regardless of the nature of the funds it dominates, it is a fact that expectations for the entire infrastructure line of the Hong Kong stock market and the real estate sector are constantly improving.

If this trend of expected change gradually ferments to the mainland market.

Then, there is no doubt that the large-scale infrastructure line can still give rise to a wave of rapid follow-up rising prices.

Also, although the growth rate of housing prices in major cities in China has gradually slowed down, the development of urbanization and the expansion scale of the entire industry are still accelerating. When the scale expansion of the entire industry is accelerating, then even if the increase in housing prices is relatively small, under the scale effect, many related companies in the industrial chain can still benefit from this huge expansion of scale effect and improve their performance.

In other words, there is a high probability that the performance of the major infrastructure line will meet expectations and can be truly reflected.

When performance meets expectations, it can be reflected quickly.

Therefore, the overall valuation of the entire major infrastructure line cannot be viewed based on the current expected trend, but a relatively more reasonable discount should be applied.

In general, it is not completely impossible for the main line of major infrastructure to continue to strengthen.

The stock of Beijiang Communications Construction is not completely unrelated to the sector's trend.

Of course, at this stage, relatively speaking, the situation of Tianci Materials is slightly better in this regard. However, Tianci Materials' stock does lack market popularity, and its internal chip structure is not as stable as that of Beijiang Communications Construction. If it wants to truly stand out and gain the recognition of the majority of short-term speculative funds in the market, it will need intense turnover and market trends to verify its performance.

"Yeah." Xu Qiao nodded and said, "The best way is to buy some of both stocks."

Old Zhang laughed and said, "That's good, but no matter what, that's all tomorrow's business."

"Based on the stock trends of Beijiang Communications Construction and Tianci Materials..." Old Wu said, "Both stocks should have their Dragon and Tiger rankings released today, right? Let's take a look at the after-hours Dragon and Tiger rankings before making a final judgment. We'll see which of these two stocks is driven by pure market consensus, or which is solely driven by the power of large speculators."

"Okay," Lao Zhang said, "Let's take a look at the after-market Dragon and Tiger List first. That way, our judgment will be slightly more accurate. Stocks with relatively strong market synergy will definitely have a higher probability of coming out on top."

After saying that, Lao Zhang turned his gaze to the two market charts again.

All I saw was the continuous discussion among several core main speculators in the main speculator group of 'Magic City Super Short Gang'.

At this moment in the trading market, time has come to the last few minutes before closing.

At this point in time, a number of core themes in the market, their corresponding related sectors, corresponding concept stocks, including the major core indexes of the market, are still continuing to decline, and the extent of the decline is accelerating.

Finally, when 3 o'clock in the afternoon arrived, the two markets reached closing time.

The Shanghai Composite Index remained below 3100 points, while the Shenzhen Composite Index and the ChiNext Index both closed with a drop of more than 1%.

Of course, this is due to the huge impact of the trend of the emerging industrial chain.

In the final trading session, a large number of small- and mid-cap stocks in the market experienced a concentrated sell-off by institutional investors, causing the corresponding core indices representing these stocks, such as the Huazheng 500 Index and the CSI 1000 Index, to ultimately close with even worse losses than the ChiNext Index. (End of Chapter)