On the last trading day before the holiday, the market performance was impressive, although the overall index was only slightly **1%, ** performed strongly, with nearly 4,800 companies rising in their share prices, more than 1,800 up more than 9%, and a median increase of 717%。According to the traditional 10% daily limit, this is almost equivalent to a 1,000-share daily limit. The CSI 2000 Index and the Micro Cap Index each surged 875% and 1056%, small-cap stocks finally ushered in a significant wave of wealth growth. In particular, the micro-cap index reversed from an early low of -5% to a 10% gain at **, adding a touch of color to the pre-holiday market. The market's expectations for the new village chief have also increased, after all, the change of management is often accompanied by a boost in market sentiment.
Market analysts believe that the strength of small-cap stocks** is due to a number of factors:The first is the change of management, followed by the intervention of the national team (the daily turnover of the CSI 2000 ETF hit a new high), and the second is the self-rescue action of private equity quantification**, and the lifting of the single selling restriction of DMA business**. The intervention of the national team is aimed at easing liquidity constraints and boosting market sentiment. However, this does not mean that the market has fully recovered, and investors should also remain cautious while enjoying the short term.
From a valuation perspective, while small-cap stocks have experienced a monthly growth of around 45%**, current valuations are still at relatively high levels, given the streak of the past three years**. There are many overvalued ** in the CSI 2000 Index, and investors need to be cautious when screening, and should not blindly reposition positions.
After experiencing a lot of volatility in the Year of the Rabbit, the mentality of investors and the market performance have changed. Although the market has seen significant ** before the holiday, the Shanghai Composite Index, Shenzhen Component Index and ChiNext have all seen varying degrees of ** throughout the year. In order to achieve long-term stable development, the A** market still needs to solve a series of structural issues, including the pace of IPOs, refinancing supervision, financial derivatives innovation, corporate governance, and institutional behavior.
Looking to the future,The A** market may usher in a new cycle, but the emergence of a full-blown bull market is unlikely, and it is more likely to be local and structural**. Investors should remain rational, pay attention to market changes, and grasp investment opportunities. After the new village chief takes office, the market expects him to observe and evaluate the market in depth during the Spring Festival, and introduce policies conducive to the healthy development of the market.