Now, trading limits are hit for hundreds of stocks! All three major indices rebound with increased trading volume, closing in the red. Concepts of driverless cars and digital currencies both surge [Stock Market Review]

The market rebounded with fluctuations throughout the day, with the ChiNext Index leading the gains. The total trading volume on the Shanghai and Shenzhen stock exchanges reached RMB 1.19 trillion, an increase of RMB 175.5 billion compared to the previous trading day. On the futures market, hot topics rotated in and out of the spotlight, with more stocks rising than falling. Over 4,400 stocks across the market advanced, and more than 100 stocks hit their daily limits. In terms of sectors, stocks related to autonomous vehicles and intelligent driving concepts surged collectively, with over 20 stocks, including Tongda Electric, hitting their daily limits. Digital currency concept stocks also strengthened amid fluctuations, with multiple stocks such as GDYC hitting their daily limits. Innovative drug concept stocks became active again, with stocks like Shutai Pharmaceutical hitting their daily limits. On the downside, gold stocks underwent adjustments, with Lvsenton falling by the daily limit. By the close of trading, the Shanghai Composite Index rose by 0.7%, the Shenzhen Component Index rose by 1.24%, and the ChiNext Index rose by 1.37%.

Sector Performance

In the sector of autonomous vehicles and intelligent driving concepts, stocks surged across the board, with over 20 stocks, including Wanma Technology, Yunnan Neijiang Power, Deren Electronics, Qiming Information, Tongda Electric, Jinjiang Online, Desay SV, Fulongma, and Genvict Technologies, hitting their daily limits. On the news front, Tesla is rumored to be planning to launch its Robotaxi service in Austin, Texas, US, on June 12, marking a significant milestone in Musk's efforts to reshape the company's business.

Additionally, recently, 9Z Intelligence, an L4-level urban distribution autonomous driving R&D and application enterprise, announced the completion of a US$100 million B3 round financing transaction. Xinshiqi, an L4-level autonomous commercial vehicle producer, also completed a RMB 1 billion C+ round financing. Institutions predict that 2025 will be the first year of explosive growth for unmanned logistics. Based on the number of express logistics outlets nationwide, the market potential for unmanned delivery vehicles is approximately RMB 468 billion.

Driven by a series of recent news catalysts, the hype surrounding the autonomous vehicle concept has expanded from logistics vehicles at the beginning to sanitation vehicles yesterday, and further spread to the entire intelligent driving industry chain today. With the continuous expansion of the sector's capacity and sustained capital inflows, this theme may still have room for repeated activity in the future. However, in the short term, after the sector's overall surge today, short-term sentiment may reach a climax, and differentiation is expected to intensify tomorrow. Focus should be placed on leading core stocks.

Digital currency stocks also strengthened, with stocks such as Lakala, Sifang Jinchuang, Xiongdi Technology, Digital China Information Service, Union Mobile Pay, Beijing Northern, GDYC, and China Finance Online hitting their daily limits. On the news front, the US Congress is advancing two key stablecoin legislations.

Guohai Securities stated that stablecoin transactions offer higher efficiency compared to traditional European and American banks, particularly in cross-border payments. While traditional bank wire transfers may take several days to complete, stablecoin transfers often take only a few minutes. Moreover, stablecoins have lower transfer fees, which depend on network conditions (taking USDT as an example, typically only a few dollars), while some payment systems charge fees proportionally at higher rates.

From a market perspective, compared to sectors like nuclear power, new consumption, and innovative drugs, the digital currency concept represents a relatively new hot topic, with more pronounced positional advantages among individual stocks. Additionally, it benefited from the spillover effect of ZhongAn Online's surge in Hong Kong. Consequently, it quickly gained capital favour during the collective rebound in short-term sentiment. However, it should be noted that this theme remains essentially driven by event-based sentiment speculation. After today's broad surge, its sustainability still requires further verification.

The innovative drug concept remained active, with stocks like Medicilow, InventisBio, Staidson, Huasen Pharmaceutical, and Joinn Laboratories hitting the limit-up, while Changshan Pharma, Chengdu Pioneer, and Sansheng Pharmaceuticals rose over 10%.

On the news front, the 2025 ASCO Annual Meeting is approaching, with 71 original research achievements from Chinese innovative drug companies selected for oral presentations. Companies like Dizal Pharma and Grand Pharma disclosed breakthrough clinical data.

Analysts pointed out that the global exposure from ASCO backs the technical prowess of domestic pharmaceutical firms, while the implementation of international R&D outcomes further expands market potential. The record-high upfront payments for domestic innovative drugs going global validate overseas recognition of local innovation capabilities, significantly improving long-term profit expectations. Market-wise, the recent resonance between short-term active capital and long-term allocation funds has driven trend-based movements in related innovative drug stocks. Unless core targets show clear negative feedback, the sector may still have further upside, with potential catch-up opportunities within.

On individual stocks

Today, market profitability improved markedly, with over 100 stocks hitting limit-ups. While the number of limit-ups was notably higher in unmanned vehicle and digital currency concepts, the current market leaders remain tied to nuclear power (controlled fusion concept). For instance, Sunwire and Rongfa Nuclear both advanced, while Zhongchao Holdings surged for 12 limit-ups in 19 days, Prince New Materials recorded 7 in 14 days, and Hefei Metalforming achieved 3 in 4 days. Overall, some mid-to-low-tier stocks diverged, but as long as core leaders remain strong, the nuclear power sector may see repeated rebounds, offering intraday low-entry arbitrage opportunities.

Additionally, high-position group stocks continued to diverge today. Yongan Pharma, Laixintongling, and Suzhou Longjie fell to limit-downs, while Zhengzhong Design, Jinlongyu, and Yushanxia A also posted significant declines. With the emergence of new themes, it is reasonable for some funds to switch between high and low positions. However, due to the improvement in short-term sentiment, the high-position clustering will not collapse all at once. It is expected that the market will continue to exhibit a pattern of reduced-capacity speculation, and the principle of retaining the strong and discarding the weak should be adhered to in response.

Outlook Analysis

Today's market saw a broad-based rebound, with all three major indices closing in the red. Over 4,400 stocks rose. Trading volume also increased, with a single-day surge exceeding 170 billion yuan, bringing the total trading volume of the two exchanges back to around 1.2 trillion yuan. From a technical perspective, the Shanghai Composite Index successfully held above the 30-day moving average while effectively standing above the 5-day moving average again, suggesting that the short-term repair rally may continue. However, from a medium-term structural perspective, the market is still mainly characterized by sideways movement. If trading volume fails to increase continuously in the future, it will still be difficult for the index to initiate a wave-like rally. Additionally, from the perspective of the futures market, recent hot topics such as the driverless car concept, innovative drugs, and nuclear power stocks have all maintained their strength, and newer themes like digital currency have also strengthened further during the trading session. However, given the current trading volume, it is not enough to support the simultaneous operation of so many hot topics. After today's broad-based rally, the market is likely to differentiate again. In this context, grasping the rotation rhythm among various themes will be the key focus for the market outlook.

Market News Highlights

1. Domestic Airline Fuel Surcharge to Be Reduced Starting June 5, with Exemption for Flights Under 800 Kilometers

Cailian Press reported on May 29 that an airline announced today that it would adjust the fuel surcharge collection standards for domestic passenger transportation starting from June 5, 2025 (including ticket issuance dates). Specifically, the fuel surcharge will be waived for flights under 800 kilometers (inclusive), while a 10-yuan fuel surcharge per passenger per flight segment will be collected for flights over 800 kilometers. The previous adjustment took effect from April 5, 2025 (ticket issuance dates), with adult passengers paying a 20-yuan fuel surcharge for flights over 800 kilometers and a 10-yuan fuel surcharge for flights under 800 kilometers (inclusive). (Yicai)

2. US Decides to Revoke Chinese Student Visas; Foreign Ministry: Discriminatory Practice Exposes So-Called "Free and Open" Lie

Cailian Press reported on May 29 that Foreign Ministry spokesperson Mao Ning hosted a regular press conference on May 29. A reporter asked about the recent US decision to start revoking visas for Chinese students, including those "with ties to the Chinese government or studying in key fields." What is the Foreign Ministry's comment on this US decision? Mao Ning responded that the US side has unreasonably canceled visas for Chinese students under the pretext of ideology and national security, seriously infringing upon the legitimate rights and interests of Chinese students and interfering with normal people-to-people exchanges between the two countries. The Chinese side firmly opposes this and has lodged representations with the US side. "This politically discriminatory move by the US side has exposed the so-called lie of 'freedom and openness' that the US has always touted, and will only further damage the US's own international image and national credibility," Mao Ning emphasized.