On Monday, the three major A-share indexes fell across the board, photovoltaic, semiconductors and liquor and other core assets sector market value evaporated 800 billion.
On March 15, the three major A-share indices opened collectively lower, further expanding the decline after lunch, the GEM index once fell more than 5% during the day, and slightly rebounded at the end of the day, as of the close, the GEM index fell 4.09%, the SZ index fell 2.71%, and the Shanghai Composite Index fell 0.96%. CSI 300 index closed down 2.15%, the largest intraday decline in the past week.
In terms of sectors, A-share liquor led the decline along with major consumer sectors, while medical, Food and photovoltaic sectors led the decline.
Reuters reports that the recent slightly conservative economic growth target set by the Chinese Communist government has raised concerns that authorities may tighten policies to curb over-valuation of the stock market.
Recently, the A-share market has seen successive adjustments in core assets represented by Guizhou Maotai. Since February 18, Guizhou Maotai shares hit a new high of 2,627.88 yuan/share, it began a phase of sharp fall adjustment to March 15, down 2.5% to 1,975.45 yuan/share, losing 2,000 yuan, a cumulative retracement of nearly 25% since the high point.
March 15, the core assets of the early group fell heavily, photovoltaic leading Longi shares fell, Ningde Times, Shanxi Fenjiu, ZTE, Tigermed fell more than 8%, Jinshan Office, Inco Medical fell more than 10%.
Longi shares fell to trigger the leading photovoltaic stocks across the board, the entire plate evaporated more than 70 billion yuan. In addition to photovoltaic, semiconductors, liquor also continued to kill, the entire core assets plate market value evaporated 800 billion.
So far, Longi shares fell 21% in March, and 10.54% year-to-date.
Analysts quoted by Brokerage China on March 15 reported that there may be recent redemptions of funds by investors. A brokerage source said that some brokerages are redeeming ETFs, but it is not clear how much. At the same Time, there are rumors in the industry that insurance companies have redeemed many funds before and in early March.
Analysts also believe that A-share core assets have been very highly correlated with the Nasdaq and the yuan recently. In the case of a big rise in U.S. bond yields, there is a killing valuation of the Nifty weights and the possibility of the U.S. dollar flowing back to the Home country, which in turn leads to a depreciation of the yuan and triggers an inevitable killing valuation of core hold assets.
According to “21st Century Finance” reported on March 15, Longi, as a giant in the PV industry, has gradually deepened its integration. However, with the release of the Notice on Matters Relating to the Development and Construction of Wind Power and Photovoltaic Power Generation in 2021 (Draft for Comments), the market believes that Longi’s profits will be further compressed and that profits have hit the ceiling with no more room to find new growth points for performance.
Recently, the market lowered Longi’s Q1 performance forecast, and it is expected that the module shipment or profitability is less than expected, and the short-term performance growth rate may be lower than the market’s previous expectation.
In addition, LONGi shares have recently been caught in a layoff fiasco. LONGi shares responded that this is mainly because of the upstream raw and auxiliary materials phase supply impact on the production line deployment.
There are two main reasons for the production line deployment. First, the price of raw materials continues to rise. This year, glass prices began to retreat, but silicon prices have risen all the way up to the level of 110,000 yuan per ton; second, this year is the first year of grid parity, the Energy Bureau in the draft request for comments on the provinces and municipalities to protect the competitive allocation of grid-connected indicators, power station companies want to grid-connected to come up with low prices or reduce the stock of subsidies, so that the market is concerned that this will reduce the installed enthusiasm of downstream power stations and compress profitability.
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