Mainland stocks bullish on first trading day

Updated 2018-02-23 10:53:03

Experts attribute rise to external markets as well as long-term momentum

The mainland stock markets surged on the first trading day after the weeklong Spring Festival holidays, arousing market speculation that a good start will lead to a further bullish trend.

The Shanghai Composite Index surged by 2.17 percent to 3,268 points on Thursday, while the Shenzhen Component Index surged by 2.18 percent to 10,659 points as of closing time.

On the two mainland markets, 27 stocks surged to the daily trading limit of 10 percent, while only five stocks slumped to the trading limit.

Airport transportation and nonferrous metals processing stocks led the rise in the markets.

The mainland markets had suffered a steep decline before the Spring Festival, with the Shanghai stock market slumping by about 10 percent from February 5 to February 9, while the Shenzhen Component Index also declined by nearly 9 percent during the period.

Li Daxiao, chief economist at Shenzhen-based Yingda Securities, told the Global Times on Thursday that the mainland stock's rise on Thursday was an almost synchronous reaction to the performance of the external market, particularly the US stock market, which has been edging up sharply during the Spring Festival period.

"Besides, based on past situations the mainland stock markets would often rise in the first week after the Spring Festival holidays.

So today's stock rise can also be deemed as a 'habitual' move," he noted.

Despite those factors, Li emphasized that long-term momentum (for stock rise) is also accumulating, such as the strong growth of many blue-chip stock companies in 2017. The country's overall economic growth would also provide a strong stimulus.

Li said that the positive influence of the A shares' inclusion in the MSCI's emerging markets index on domestic markets will also manifest to a greater extent.

Yang Delong, chief economist at Shenzhen-based First Seafront Fund Management Co, said that the stock rise on the first trading day after Spring Festival is just "start" of a new wave of rises on the markets.

"Stock markets in 2018 will be slow bullish with sectors like new energy cars showing strong performance," he told the Global Times Thursday.

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