China's stock markets ended the first half of 2024 on a positive note, with major indices showing steady growth. The Shanghai Composite Index rose 0.59% on June 30 to close at 3,197.90 points, while the Shenzhen Component Index gained 0.83% and the ChiNext Index, tracking growth enterprises, jumped 1.35%. The rally was broad-based, with over 4,000 stocks advancing and total market turnover reaching RMB 1.52 trillion.
For the first six months of 2024, the Shanghai Composite accumulated a 2.76% increase, with the Beijing Stock Exchange 50 Index surging nearly 40% during the same period. June proved particularly strong, with the Shanghai index up 2.9%, Shenzhen up 4.23%, and ChiNext soaring 8.02% - its best monthly performance since January 2023.
Market activity was fueled by several factors, including growing investor confidence in China's economic recovery and excitement around emerging technologies. The banking sector showed steady gains, while thematic investments in areas like artificial intelligence (through concepts like DeepSeek), precious metals, robotics, stablecoins, and nuclear fusion attracted significant attention. Over 3,700 stocks posted gains in the first half, with more than 100 doubling in value. Chemical company United Chemical led the pack with an impressive 440% surge.
Analysts note the market's performance reflects improving risk appetite among investors. UBS Securities China strategist Meng Lei suggested the current trend of small-cap stocks outperforming may continue in the near term. The market's direction in the second half will likely depend on several factors, including the evolution of China-U.S. trade relations, domestic policy support, and global macroeconomic conditions.
With July historically being a strong month for A-shares, market participants are watching to see if the current momentum can be sustained, particularly in technology and consumer sectors that have shown recent strength. The strong close to the first half provides a solid foundation as investors look ahead to the remainder of 2024.
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