On March 18, the adjustment of FTSE global stock index series and FTSE China A50 Index officially took effect. Affected by this, in the last three minutes of the A-share trading session, the inflow of funds from the North accelerated, and the amount of pending orders once exceeded 39 billion yuan. At the same time, the trading volume of some stocks at the end of the trading day was significantly enlarged, and the stock prices of many targets involved in this adjustment, such as Bank Of Ningbo Co.Ltd(002142) , Postal Savings Bank Of China Co.Ltd(601658) and so on, plunged during the call auction stage at the end of the trading day, and the “magic spell of the effective date” was fulfilled again.
It is worth noting that Kweichow Moutai Co.Ltd(600519) , Contemporary Amperex Technology Co.Limited(300750) , are not involved in this index adjustment. However, the share prices of the two leading companies plunged at the end of the trading day, and the investors couldn’t help asking, “what’s this?”
In addition, the mood of northward funds warmed up, showing a net inflow trend for two consecutive days. Foreign institutions said that the final trend of funds and the trend of the stock market are determined by fundamentals, and Chinese assets are attractive in the medium and long term.
multiple stock late trading changes
On March 18, Bank Of Ningbo Co.Ltd(002142) share price fluctuated and rose, with an increase of nearly 2% near the closing. However, in the call auction stage just before the closing, the trading volume suddenly enlarged and the share price plummeted by more than 2%. As of the closing, Bank Of Ningbo Co.Ltd(002142) shares fell 0.92% to 34.48 yuan / share.
The reason for the change in the late trading was that the FTSE Russell index adjustment took effect. According to the previously released announcement, the adjustment of FTSE global stock index series and FTSE China A50 Index officially took effect after trading on March 18. In this adjustment, the FTSE global stock index series includes 102 new Chinese A shares, including Amlogic (Shanghai) Co.Ltd(688099) , Anhui Yingjia Distillery Co.Ltd(603198) , Bloomage Biotechnology Corporation Limited(688363) , etc. The FTSE China A50 Index is newly included in Bank Of Ningbo Co.Ltd(002142) , Postal Savings Bank Of China Co.Ltd(601658) , China State Construction Engineering Corporation Limited(601668) 3 A-share targets.
Since passive funds often choose to rush to raise or sell at the end of the effective date to reduce the tracking error of the index, on the day of the landing of the index adjustment, the trading volume of newly included or excluded stocks will be significantly enlarged, causing stock price changes.
Like Bank Of Ningbo Co.Ltd(002142) , Postal Savings Bank Of China Co.Ltd(601658) which was newly included in the FTSE China A50 Index also plunged in the late trading, and the trading volume was significantly enlarged.
Cngr Advanced Material Co.Ltd(300919) , China Resources Microelectronics Limited(688396) , which were newly included in the FTSE global stock index series, also saw a sudden rise in trading volume and a sharp rise in share price in the last three minutes before the closing.
Kweichow Moutai Co.Ltd(600519) , Contemporary Amperex Technology Co.Limited(300750) the tail sector was smashed
It is also a newly incorporated stock. Why did some stocks rise at the end of the day, but some share prices plunge? Market participants said that institutional game may be the main reason.
A private equity fund manager told reporters that when the index adjustment landed, the passive index funds tracking the index collectively bought at the end of the day, resulting in a rapid amplification of trading volume and a sharp rise in share price. However, when the market unanimously expected the transfer of individual stocks to rise at the end of the day, funds ambushed in advance to capture the rise. So as to sell arbitrage at the end of the trading, causing the stock price to plunge.
It is worth noting that this index adjustment does not involve Kweichow Moutai Co.Ltd(600519) , Contemporary Amperex Technology Co.Limited(300750) , but the stock prices of the two leading stocks also plunged at the end of the day.
A public offering person told reporters that the late decline of “Maoning” is not necessarily directly related to the index adjustment. “There are too many factors in the game of individual stock trading at this stage. During the effective period of component stock adjustment, the fund game of institutions will be further intensified,” he said
foreign funded institutions: Chinese assets are still attractive in the medium and long term
A record 16 billion yuan of funds were sold to the north at the beginning of the year, or even the highest net outflow of 3.4 billion yuan in a single day. However, since March 17, northbound capital sentiment has warmed up, with net inflows for two consecutive days (March 17 and 18), with a total net purchase of 13.822 billion yuan.
Huili fund investment team said that the net outflow of foreign capital in early March may be affected by three aspects. First of all, the situation in Russia and Ukraine is tense, and the demand for capital hedging has increased. From the perspective of global allocation, emerging markets will generally become the main outflow places; Secondly, the rapid rise of commodity prices has increased the burden on China’s manufacturing industry to a certain extent, or triggered the outflow of foreign capital; Third, when the United States enters the interest rate hike cycle, foreign capital will generally return to the United States from emerging markets in history.
“However, the final trend of funds and the trend of the stock market are still determined by fundamentals.” Huili stressed that he was optimistic about China’s economy. First, the external geopolitical situation has a relatively limited impact on China’s economy, and war is not a medium – and long-term normal; Second, due to the improvement of China’s anti epidemic measures and the intensive development of relevant therapeutic drugs, the impact of the epidemic on China’s economy is getting smaller and smaller than that in the past two years; Third, China’s economy can still maintain healthy and sustained growth. The steady and positive trend of China’s economy will be transformed into real performance at the micro enterprise level. In addition, the current relatively low valuation means that China’s assets are attractive to foreign investment in the medium and long term.
