A-share closing review | Three major positives boost morale! Shanghai Composite Index closes up for the third consecutive day, ChiNext Index closes up 0.83%, dividend stocks active.

On May 21st, the A-shares continued to rebound, with the Shanghai Composite Index closing up for the third consecutive day, with over 3600 stocks trading in the red overall. At the close, the Shanghai Composite Index rose by 0.21%, the Shenzhen Component Index rose by 0.44%, the ChiNext Index rose by 0.83%, and the BSE 50 hit another historical high during the trading day. The rebound of the indices has been attributed to three main factors affecting the market: Firstly, several foreign institutional investors have recently expressed their intention to gradually increase their allocation in Chinese assets. In addition, Morgan Stanley has raised its economic growth forecast for China for the next two years. Secondly, the heavyweight stock Ning Wang A in the ChiNext board surged by over 4%. Contemporary Amperex Technology rose by over 16% on its first day of trading in Hong Kong at a premium compared to A-shares, and its H-shares rose by over 10% on the second day of trading. Thirdly, on the 20th, both deposit and lending rates were simultaneously lowered, favoring dividend-style investing. According to Beijing Business Daily, the People's Bank of China lowered the LPR rate, and several large banks also lowered deposit rates, making high dividend assets more valuable. On the market, dividend-style investing was strong, with coal, power, and large financial sectors leading the gains. Several stocks such as Bank Of Jiangsu and Bank Of Chengdu hit historical highs. The automobile sector saw gains, with BYD Company Limited hitting a historical high. Pharmaceutical stocks continued to strengthen, with innovative drugs and pharmaceutical business sectors leading the way. The solid-state battery sector saw a surge, with stocks like Gotion High-tech hitting limit up. Additionally, precious metals, port shipping, and liquor sectors performed well. Conversely, consumer electronics, education, and military sectors saw declines. Looking ahead, Orient believes that the A-shares are entering a new stage where external disturbances are gradually subsiding. Despite a decrease in trading volume and rapid sector rotations, there is still support for the market. It is predicted that the Shanghai Composite Index will consolidate near 3400 points in the short term, with a continuing trend of consolidation and upward movement in the medium term. Popular Sectors: 1. Pharmaceutical stocks continue to strengthen, led by the pharmaceutical business and innovative drug sectors. 2. The solid-state battery sector is surging, with companies like Gotion High-tech and others hitting limit up. Institutional Views: 1. EB Securities believes that the style of hot spot rotation may continue. 2. Sealand believes that the market is currently in a period of consolidation before a breakthrough. 3. Orient believes that the A-shares are entering a new stage of gradual relief from external disturbances.