A-shares fluctuate and rebound, with cyclical stocks surging and technology stocks remaining active in resonance

On April 7, the A-share market saw a stabilizing rebound on the first trading day after the Qingming Festival holiday. Throughout the day, the market showed the pattern of “indices moving gently upward while individual stocks remain fully active.” All four major stock indexes closed higher in red; cyclical sectors exploded across the board; the technology track maintained resilience; financial heavyweight stocks took a relatively restful phase; and the market’s “money-making” effect was noticeably better than in the prior period.

As of the close that day, the Shanghai Composite Index (SSE Composite) was 3,890.16 points, up 0.26%; the Shenzhen Component Index was 13,400.41 points, up 0.36%; the ChiNext Index closed up 0.36% at 3,160.82 points; and the STAR Market Composite Index closed up 0.85% at 1,645.51 points. The combined total trading volume across the three markets (Shanghai, Shenzhen, and Beijing) that day was 1.62 trillion yuan, a slight contraction of 45.3 billion yuan compared with the previous trading day. At the individual stock level, a broad-based advance prevailed: more than 3,900 stocks rose nationwide, the number of stocks hitting the daily limit exceeded 100, the number of stocks hitting the daily lower limit remained low, and market bullish sentiment warmed up.

Cyclical sectors led the market

Judging by the performance of sectoral segments, cyclical sectors became the strongest main theme of the day. Resource sectors such as basic chemicals, petroleum & petrochemicals, and coal all surged together, leading the entire market. Among them, the basic chemicals sector was active throughout the day, with sub-sectors such as polysilicon and agrochemicals and fertilizers moving higher across the board. In terms of individual stocks, Jiangtian Chemical and Dongyue Silicone Materials hit the daily limit with gains of 20%. XinAn Shares, Sinofert United, and Liu Hua Shares, among others, also hit daily limits.

The petroleum & petrochemicals sector followed closely, with sub-sectors such as oil and gas extraction, refining & chemical, and oil services rising in sync. International crude oil prices have recently remained in a high-level range-bound fluctuation; geopolitical factors and changes in the global supply structure have supported oil prices moving higher. In terms of individual stocks, stocks such as Heshun Petroleum and Hengyi Petrochemical hit daily limits.

In terms of news, according to Xinhua News Agency, early on April 7, the Fars News Agency (Iran) cited unnamed sources as reporting that an explosion occurred in the Jubail Industrial Zone in Japan’s northeastern Saudi Arabia, where capital from the United States was involved, and that it was the result of a large-scale attack. The Jubail Industrial Zone is one of the world’s important petrochemical production bases; its annual output is about 60 million tons of petrochemical products, accounting for 6% to 8% of the global total production.

In addition, among cyclical sectors, agriculture, forestry, animal husbandry, and fishery performed remarkably well, especially the pig farming industry chain, which was active. Huatong Shares hit the daily limit; and followed up were Giant Star Agriculture & Animal Husbandry, Longda Foods, Lihua Shares, Dayu Biologics, and others.

In recent times, pig prices have continued to grind at the bottom. On April 1, the National Development and Reform Commission, the Ministry of Commerce, and the Ministry of Finance announced that they would carry out the 2026 second batch of central frozen pork reserve purchases and storage operations in the near term, and required localities to implement corresponding measures simultaneously. This was widely viewed as a clear signal that the government would support pig prices.

Technology track remains active

The technology growth track is still active, becoming another major theme in the market. The semiconductor industry chain strengthened, with sectors such as memory chips and domestic compute power rising. The Apple industry chain boosted the consumer electronics sector. The STAR Market Composite Index led in gains relative to other major indexes, reflecting capital’s preference for hard technology and high-growth areas. In terms of individual stocks, Cambricon rose by more than 9%, with the share price returning above 1,100 yuan; the two leading wafer foundry giants, SMIC and Vanguard Technologies (HuaHong), both rose by more than 3%.

In terms of news, according to reports on April 7 local time, Samsung Electronics released guidance for its unaudited first quarter of 2026 performance: its preliminary operating profit for the first quarter reached 57.2 trillion won (about US$37.9 billion), setting a record high and far above analysts’ average expectation of 39.3 trillion won; revenue climbed to 133 trillion won as well, higher than the average estimate of 116.8 trillion won.

In addition, media reports say Foxconn has already entered trial production for Apple’s foldable-screen iPhone. Previously, Apple’s shipment target guidance to suppliers was that the first foldable-screen phone would be launched in the second half of 2026—a large-fold foldable-screen iPhone.

According to the Counterpoint Research report titled “Market Forecast for Foldable Smartphones,” supported by factors such as Apple’s expected entry and the continued premiumization of the smartphone market, as well as an increase in OEM participation, global shipments of foldable-screen smartphones in 2026 are expected to grow by 20%. With Apple preparing to launch its first foldable-screen iPhone, the foldable smartphone market will enter a new competitive stage in 2026. The firm predicts that Apple could capture about a 28% market share in 2026, approaching Samsung’s leading position.

Anji Securities believes that foldable-screen phones are a core innovative category in the smartphone field. With hinge-based and flexible display module components as key building blocks, they effectively balance the core contradiction between large-screen user experience and device portability. Compared with non-foldable-screen phones, the incremental costs are mainly concentrated in three areas: display modules (display panel + glass cover), mechanical/electromechanical components (including hinges), and memory. Under an optimistic outlook, Apple’s foldable-screen iPhone sales in 2026 could reach 14 million units; the iPhone’s own premium positioning and massive sales volume could drive rapid growth across the entire industry chain.

Institutions: short-term volatility may still be relatively high

Looking ahead, research reports from multiple brokerages suggest that short-term market volatility remains high; it may still take some time to work through the base with ongoing consolidation. However, compared with overseas equity-class assets, A-shares are more stable, and market pullbacks can actually be an opportunity.

Guotai Junan Securities said that after market adjustments, China’s stock market is showing signs of an important bottom and a “hitting point.” China’s economic transformation and positive industrial progress are key to breaking the current widespread perception of stagflation risk, and are the foundation for China’s stock market’s slow upward trend. Market adjustments are instead opportunities, and they recommend actively positioning.

Soochow Securities believes that compared with overseas equity-class assets, A-shares are more stable: on the one hand, because China is more desensitized to the risk of rising crude oil prices; on the other hand, because of the continued repair of macro fundamentals and support from micro-level capital. Entering April, the capital market may move past uncertainty. Investors are advised to seize the “April decision” and look for opportunities with certainty.

However, Shenwan Hongyuan Securities reminds investors that the current pricing in A-shares still retains room for both upside and downside risks; it is neutral pricing, not steady-state pricing. The market is still adjusting mid-term scenario assumptions and probability distributions in response to overseas conflict events as catalysts. In the short term, market volatility remains high, and it is not the moment to place heavy bets.