From last week until today, the Shanghai Composite Index has been falling for four consecutive days. In particular, there was a panic decline last Friday. Some people also asked if it was a stock crash. There are also many numbers saying that a big level has appeared at the top, and a unilateral decline has begun. These are all sentiments that are easy to see in a falling market; I don't think they are objective or incomplete. Let me talk about my opinion today.
First, the logic of the general market going to the large-scale bull market that began at the end of October last year has not changed. This is determined by the determination at the top to develop the economy and expectations for China's economic recovery. Now this determination and expectations are slowly being confirmed by data, so there will be no unilateral market decline like last year. The only variable is the recession in the US economy, whether it is a gradual recession, or a rapid recession like a sudden explosion of a big thunderstorm. If it's the latter, it will still dig a hole in the short term, but it won't affect the long-term trend.
Once you've decided on the general direction, take a look at the board. In this round of decline, conceptual artificial intelligence and semiconductors, which have seen the strongest gains in recent months, are leading the decline. The scope of expansion points to sectors is software development, computers, and communications.
Take the software sector as an example. The market was the first to rebound before the overall rebound in the market last year, but it ended in mid-November. After about two months of adjustments, the market began to rise again in January. At present, it is the end of the main upward trend in the market. The mid-term pullback is also at the monthly level. It hasn't arrived in a month yet. Whether it's artificial intelligence or computers, these sectors are all closely linked around the main line of digital China. The general trends are similar, only at the daily level...