What happened? In the afternoon, the Shanghai Composite Index once again fell below 3,900 points.

Reporter | Xiao Ruidong Editor | Zhao Yun

On March 26, the market saw choppy consolidation. All three major indexes surged and then fell back, dropping more than 1%, with the STAR Market 50 Index falling more than 2%. As of the close, the Shanghai Composite Index fell 1.09%, the Shenzhen Component fell 1.41%, and the ChiNext Index fell 1.34%.

By sector, the power sector was active. Lithium battery material stocks repeatedly strengthened, and commercial aerospace-related themes saw a partial lift. On the downside, the power grid equipment concept weakened, and the fiber optics concept tumbled in a bout of volatility.

More than 4,400 stocks across the entire market declined. The combined trading value of the Shanghai and Shenzhen markets fell below 2 trillion yuan, down 236.2 billion yuan from the previous trading day in terms of contracted volume.

After two straight days of rebound, today the A-share market pulled back with lighter volume.

There are roughly two reasons:

First is the seesaw effect of “oil up and shares down,” and today it’s again oil prices taking the lead.

In the afternoon, both Brent crude oil futures and WTI crude oil futures strengthened.

According to reports, on Wednesday, both the U.S. and Iran made their latest statements in succession, making the situation clearer. The Iranian side said that “exchanging information” with the U.S. by way of the mediator is not negotiations; while the White House insisted that the U.S.-Iran talks “are still ongoing.”

Some believe that no matter how many updates this “Whose-Truth-Is-it” (a “Rosegate”) over the U.S.-Iran talks sends out every day, as long as the fighting has not ended in substance, the logic that supports higher oil prices will still exist. Market participants are expected to gradually “desensitize” to the news, but it’s very difficult to completely ignore it.

As strategists from JPMorgan Chase’s market intelligence team said, they have ended their earlier tactical bearish ratings on the stock market and shifted to a neutral stance. However, the firm still expects that market volatility will further intensify.

Second, after the consecutive rebounds, the market also needs to take a breather and lock in gains in line with the move.

It’s not that the market “can’t rise three days in a row”; rather, when objective upward headwinds are stronger than the downside, a pullback naturally occurs. A “two steps forward, one step back” pattern is typically acceptable to the market as well—but if too much of the gains is given back, it will inevitably trigger fresh panic.

One view holds that the short-term “panic-buy reversal” triggered by oversold conditions can be seen as “a benefit for all stocks,” but for different sectors and different individual stocks, just how much of that benefit can be realized and when it will be fully played out contains an element of randomness.

The different intensity and speed of the rebound will determine whether, during this rising phase, sectors and individual stocks form new patterns of relative strength and weakness.

Wind data shows that during the consecutive rebound on Tuesday and Wednesday, the maximum gain in the whole-A average stock price (from the lowest point) was 5.85%.

Among nearly 5,500 stocks in the entire market, during the same period, 3,531 achieved a maximum gain of more than 5.85%.

And for those with cumulative gains of over 10% across the two days, there are only a little over 1,000.

Against this backdrop, short-term capital needs to conduct a certain amount of “cutting weaker positions and keeping stronger ones” to pursue more excess returns.

After the market’s rebound, the adjustment process is also the process of funds rotating out of sectors and switching holdings.

For the medium to long term, the strategy team at Shenwan Hongyuan believes that the fundamental backdrop of the A-share market’s upward trend has not changed. It says that an increase in the oil-price center of gravity may bring mild stagflation-like conditions, but because China’s domestic inflation base is relatively low—and combined with the maturity of the policy framework for dealing with structural economic issues via domestic regulation—the upward pressure on costs faced by A shares will be clearly smaller than in the historical extreme scenarios (2010–2011 and 2021).

In addition, midstream manufacturing industries are still in a historically significant supply-clearing cycle, and in the second half of 2026, the pace at which capacity forms is expected to be lower than the pace of revenue growth. It is expected that in 2026, A-share profitability will effectively rebound, and the trend of cumulative profits year on year rising quarter by quarter will remain unchanged. The medium-term uptrend in A shares has fundamental support.

“China’s economic strengths are becoming more evident, and the trend toward improvement in China’s capital markets in the long run has not changed. Rapid changes in liquidity are not the norm for the A-share market. Some short-term problems have been over-interpreted as medium-term concerns. In the short run, this may be the time when pressure is greatest; in the medium run, confidence should be firm and patience should be maintained.”

Judging from today’s performance by sector, besides oil and gas leading by tracking oil prices, energy metals and battery-related directions in the lithium battery industry chain—though they surged and then gave back some ground—still left room for gains.

HuaXin Securities said that the core of this Middle East geopolitical conflict lies in the reassessment of the “security attributes” of the energy system. Global energy allocation patterns and macro transmission pathways have both been reshaped, and energy policies across countries have shifted toward “independent and controllable plus diversified substitution.” Mapped to A shares, three areas benefit: new energy power generation, energy storage, and power grid equipment. The center of gravity for demand for new energy installed capacity has moved up; the strategic position and profitability of energy storage have improved; and power grid and power equipment are set to enter an accelerated investment cycle.

In addition, the commercial aerospace concept saw some capital returning after the afternoon, and it briefly turned positive.

On the news front, SpaceX plans to submit its first publicly issued offering registration statement to regulators later this week or early next week. In its IPO, the company may raise more than $75 billion, higher than the $50 billion estimate previously reported, and its latest valuation is $1.25 trillion.

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责任编辑：宋雅芳