On November 1st, the A-share market in China experienced a general decline. The ChiNext Index led the losses with the Beixin 50 Index plunging by 9.61%. High-priced stocks collectively plummeted, with over 500 stocks in the market falling by more than 9%.
At the close of trading, the Shanghai Composite Index closed at 3272.01 points, down by 0.24%; the Shenzhen Component Index closed at 10455.5 points, a decrease of 1.28%; the ChiNext Index closed at 2123.74 points, a decline of 1.88%; and the Beixin 50 Index dropped by 9.61%.
The market saw a widespread downturn, with more than 4300 stocks in Shanghai, Shenzhen, and Beijing falling, high-priced stocks experiencing significant drops, and over 500 stocks in the market declining by over 9%. The total trading volume in Shanghai and Shenzhen surpassed 2.23 trillion yuan (RMB), marking an increase of 131 billion yuan from the previous trading day.
According to reports from “Gelonghui,” multiple high-priced stocks hit their downside limits, leading to a stampede of funds fleeing the market. Following the sharp drops in high-priced stocks at the end of trading yesterday, they continued to plummet today. Market favorites like Shuangcheng Pharmaceuticals, Chengde Xiangjiang, Huadong Numerical Control, Datang Telecom, Zongshen Power, Hengyin Technology, Taihe Intelligence, and Yuexing Guangxi among more than 30 popular stocks all hit their downside limits.
Reflecting on the market trends in October, the market sentiment was highly fragmented. While indices remained relatively stable, high-priced popular stocks were continuously driven higher by major institutional investors. Market sentiment fluctuated wildly, reaching a frenzy of downside limits today. The fundamentals of some high-priced stocks have not significantly improved, with their price increases being mainly fueled by market speculation and capital inflows.
Citing data from Haineng Dalonghui on the Dragon and Tiger List, between October 21st and October 30th, 94.01% of the trading volume came from individual investors, with 71.06% of this volume coming from small and medium-sized investors, resulting in a net inflow of 1.314 billion yuan. Institutional investors, however, started to exit early, with a net outflow of 595 million yuan, including a net outflow of 166 million yuan from the Shenzhen-Hong Kong Stock Connect investors.
Financial blogger and Weibo influencer “Stock Market Angela” remarked, “Without a solid foundation, it will vanish like a bubble.”
Financial blogger “Simple Creates Classics” commented, “What we foresaw yesterday has all come true today. The Guozhen 2000 Index plunged by 3.72%, the Zhongzheng 1000 Index by 3.05%, and the Weipan Stock Index by 4.11%. Previously strong stocks are now retreating, with 165 hitting their downside limits and 904 seeing declines of over 7%. A phase of market speculation has passed; it’s time to see how to adapt.”
Weibo influencer “Wu Pei” advised, “As the main players run, retail investors should not follow suit.”