A-share midday report | GEM Index fell 1.82% in the morning, with more than 4700 stocks in the market falling. Precious metals and bank stocks rose against the trend.

On March 31st, the A-shares market opened weak and shaky, with the ChiNext Index leading the decline. More than 4700 stocks were trading in the red, with a total turnover of 773.9 billion yuan in the first half of the day, an increase of 54.8 billion from the previous day. By the midday closing, the Shanghai Composite Index fell by 0.97%, the Shenzhen Component Index fell by 1.66%, and the ChiNext Index fell by 1.82%. On the news front, after the "Trump storm" hit the US stock market last Friday and caused a sharp drop, the panic spread to the Asia-Pacific markets on Monday. The stock markets in Japan and South Korea opened with sharp declines, with the Nikkei 225 index dropping to a near three-week low. In terms of sectors, dividend-paying stocks helped support the market, with sectors like electric power and banking leading the gains. China Construction Bank Corporation rose by over 3%. The precious metals sector strengthened against the trend, with Henan Hengxing Science & Technology hitting the daily limit. The automobile sector saw gains, with Anhui Ankai Automobile hitting the daily limit. On the downside, stocks related to Siasun Robot & Automation saw significant declines, with Jiangsu NanFang Precision hitting the limit for the third consecutive trading day. Chemical stocks continued to adjust, with multiple stocks hitting the limit. The sectors of film and television, photovoltaics, games, and computer equipment were among the top decliners. As for individual stocks, Xiangcai Co.,Ltd and Shanghai DZH Limited both hit the daily limit after resuming trading. Xiangcai Co.,Ltd announced its intention to merge with Shanghai DZH Limited through a stock swap and raise up to 8 billion yuan in supporting funds, with trading resuming on Monday. Shanghai DZH Limited also announced the same day its intention to be absorbed by Xiangcai Co.,Ltd in a 1:1.27 swap ratio, with trading resuming on Monday. Looking ahead, BOC International pointed out that in general, the A-shares market may enter a period of volatile adjustment in the short term, with earnings certainty becoming the main focus of excess returns in the market in April.mation sector declinesSiasun Robot & Automation concept stocks fell sharply, with Jiangsu NanFang Precision hitting the limit down for three consecutive trading days, Hanwei Electronics Group Corporation, Hengong Precision Equipment, Jiangsu Pacific Precision Forging, Tungkong Inc., Thinker Agricultural Machinery, and other stocks plummeting. Comments: In terms of news, well-known investor Zhu Xiaohu of Jinsha River Venture Capital stated in a media interview that he is currently mass exiting Siasun Robot & Automation, and expressed that he cannot see the commercial potential of intelligent or humanoid Siasun Robot & Automation companies at the moment. Institutional Views 1. CITIC SEC: Market reaction after the tariff "storm" CITIC SEC pointed out that the tariff "storm" is expected to land in early April, with China likely to be most affected but also most prepared; controlling supply and maintaining demand, the direction of second-quarter domestic policy efforts is becoming clearer. After the tariff "storm" lands, it is expected that A-shares will rebound, Hong Kong stocks will consolidate, and U.S. stocks will recover. From a performance perspective, core assets have shown strong operational resilience, and the opportunity for left-side layout has matured; from a liquidity perspective, active funds have significantly retreated, and industrial themes need catalysis and time to accumulate strength. In terms of allocation, the focus is on igniting technology, strengthening supply-side efforts, and shoring up consumption weaknesses. 2. BOC International: Focus on earnings certainty during earnings season BOC International stated that industrial enterprise profits continued to improve at the beginning of 2025, with industrial enterprise inventories continuing to rise. Leading indicators such as revenue and PPI are in a weak recovery, indicating that active restocking cycles are continuing. The market is waiting for the implementation of Trump's new tariff policy, with expectations that the impact of this round of tariffs on A-shares will be limited. Overall, in the short term, A-shares may enter a period of volatile adjustment, with earnings certainty becoming the main driver of excess returns in the market in April. The AI industry chain trend is still evolving, with overall business conditions stabilizing and moderately declining providing good opportunities for entry. In the short term, it is recommended to focus on industries with good growth prospects and strong valuation attractiveness, including emerging consumer, pork cycle, pharmaceutical, and home appliance sectors. 3. Guotai Junan: Further volatility expected, focus on staying conservative Guotai Junan stated that the lack of upward revision expectations for Xiong'an New Power Technology, combined with increased uncertainties, will lead to the stock market entering a period of consolidation and volatility in the next phase. It is important to stay conservative at this moment, as April is the month when the stock market is most focused on growth performance. Positive policies are expanding, with high local enthusiasm for implementation, and two new beneficiaries are expected to benefit from this. Focus on technology growth industries with clear trends and high order fulfillment rates. In the short term, look at cyclic industries that benefit from supply optimization or new demand-driven price increases. Themes related to stable and free cash flows will return to focus, while avoiding small and medium-sized stocks. themes to watch include autonomous and controllable, silver-haired economy, AI intelligence, and mergers and acquisitions. This article is reproduced from "Tencent Self-selecting Stocks", GMTEight Editor: Wang Qiujia.