After three and a half years! The Shanghai Composite Index closed above 3,600 points again, with over 4,300 stocks rising [Stock Market Review]

The market rose in volatile trading throughout the day, with all three major indices hitting new annual closing highs. The Shanghai Composite Index closed above 3,600 points. The combined turnover of Shanghai and Shenzhen markets reached 184 billion yuan, shrinking by 19.9 billion yuan from the previous session. Sector-wise, market hotspots appeared fragmented, with more stocks gaining than declining—over 4,300 stocks advanced across the board. The Hainan Free Trade Port concept stocks collectively surged, with Hainan Airport and over 20 others hitting limit-up. Rare earth permanent magnet concept stocks rallied again, with Rising Nonferrous Metals reaching limit-up. Super hydropower concept stocks bottomed out and rebounded, with PowerChina and multiple others hitting limit-up. At the close, the Shanghai Composite gained 0.65%, the Shenzhen Component rose 1.21%, and the ChiNext Index climbed 1.5%.

By sector

Hainan concept stocks staged a full-scale breakout, with Kangzhi Pharmaceutical, China Tourism Group Duty Free, Hainan Airport, Hainan Development, Luoniushan, HNA Infrastructure and over 20 others hitting limit-up. The National Development and Reform Commission (NDRC) announced that the specific timeline for the customs closure of Hainan Free Trade Port will officially commence on December 18, 2025.

CITIC Securities believes the offshore duty-free policy offers greater flexibility regarding both duty-free quotas and policy restrictions for entering the "second line." The continued implementation of this policy will maintain its competitive edge. More fundamentally, from a commercial perspective, the leading advantage in core property layout, supply chain resources, and superior operational capabilities form the foundational support. Offshore duty-free operators that complete their commercial layouts first will retain their dominant position in Hainan's retail market.

Market-wise, Hainan-related concept stocks underwent significant adjustments yesterday due to profit-taking after the policy announcement, but managed to complete a swift rebound today. With relatively sufficient turnover in chips, the sustainability of this theme appears more promising. However, after over 20 limit-ups in the sector today, short-term divergence may emerge due to excessive consensus, warranting close attention to leading core targets.

The rare earth sector led gains throughout the session, with Bao Gang United Steel, Chengxin Lithium, Zhong Ke San Huan, and Rising Nonferrous Metals hitting limit-up, while JL MAG Rare-Earth, China Northern Rare Earth, and China Rare Earth Holdings ranked among top gainers.

Driven by rising Pr-Nd alloy selling prices and the current relatively euphoric short-term market sentiment, rare earth magnetic materials—a high-beta pro-cyclical segment within nonferrous metals—have delivered standout performance recently. Guojin Securities noted in its weekly industry report that rare earths, as core strategic resources for modern industry, hold irreplaceable value in high-end manufacturing. The sector benefits from strengthening supply tightness expectations, gradually recovering demand, and persistently high overseas prices.

Lithium mine stocks also rose in volatile trading, with Tibet Mineral Development, Tianqi Lithium, and Chengxin Lithium hitting limit-up, while Huayou Cobalt, Ganfeng Lithium, and Tibet Summit Resources ranked among top gainers.

Guotai Futures noted that benefiting from the NEV industry chain's "anti-rat race" policies, lithium prices may shift from macro-driven to policy-driven upward momentum. Additionally, Zangge Mining recently announced its wholly-owned subsidiary received a notice to halt lithium resource development, potentially optimizing supply. With lithium battery installations maintaining rapid growth and lithium ore industry supply showing optimization, the sector is expected to gradually emerge from its darkest period.

Stock-wise

, the super hydropower concept initially faced divergence at market open but quickly bottomed out. Core stock PowerChina surged by the daily limit again, achieving four consecutive limit-ups with turnover exceeding 15 billion. China Energy Engineering, CRCC Heavy Industry and other capacity stocks also rebounded from negative territory, while China Design Group staged an "intraday reversal" in the afternoon. Over 10 stocks including Tibet Tianlu, Gaozheng Explosive, Sany Heavy Industry, Sinochem Rock & Soil, CREC Industrial, Sobute New Materials also maintained limit-ups. The concept's transition from divergence to consensus demonstrated its short-term dominance. Particularly, leading stocks maintained strong popularity relative to core plays, suggesting further upside momentum. However, as yesterday's article mentioned, mid-to-back-tier stocks showed weaker recovery and are gradually being phased out, indicating future super hydropower trends may focus more on core clustering patterns.

Outlook

, all three major indices rose again today, with the Shanghai Composite closing above 3,600 points while the Shenzhen Component and ChiNext hit new annual highs. Trading volume remained above 180 billion. Overall, after yesterday's divergent expansion, today's swift recovery confirmed robust market resilience. Unless the 5-day moving average is effectively breached, indices should maintain their oscillating upward trajectory. Futures market-wise, the super hydropower and "anti-rat race" themes are becoming clearer dual mainlines, likely dominating future hot topics. Leading stocks may serve as key sentiment barometers—their sustained strength could present catch-up opportunities in related subsectors, whereas significant breakdowns in high-profile large-caps might signal thematic retreat.

Market Highlights

1. Two ministries solicit public comments on the "Price Law Amendment Draft (Consultation Paper)"

The NDRC and State Administration for Market Regulation released the "Price Law Amendment Draft (Consultation Paper)" for public feedback, addressing new situational demands. The draft opinion proposes that the current situation facing price work has undergone significant changes, with prices for the vast majority of goods and services now being determined by the market. New economies, new business formats, and new models continue to emerge, and the issue of low-price and disorderly competition in some industries has become prominent, posing new requirements for price regulation and supervision.

2. The Ministry of Ecology and Environment publicly solicits opinions on two national ecological and environmental standards: the "Feasible Technical Guidelines for Air Pollution Prevention and Control in the Glass Industry (Draft for Comment)" and others.

Cailian Press, July 24th: To prevent and control air pollution, improve air quality, and promote the advancement of air pollution prevention and control technologies in the glass and mineral wool industries, the Ministry of Ecology and Environment has undertaken the preparation of two national ecological and environmental standards: the "Feasible Technical Guidelines for Air Pollution Prevention and Control in the Glass Industry" and the "Feasible Technical Guidelines for Air Pollution Prevention and Control in the Mineral Wool Industry." It is now publicly soliciting comments on the drafts of these two standards.