Stock markets across the Asia-Pacific region plummeted, with China’s three major indices following the downward trend. By the close of trading, the Shanghai Composite Index fell by 0.67%, the Shenzhen Component Index dropped by 0.74%, and the ChiNext Index declined by 0.64%. The total market turnover reached 2.67 trillion yuan, an increase of 451.3 billion yuan compared to the previous trading day, with over 3,900 stocks falling.
In terms of sector performance, the aviation and airport sectors slumped, with China Eastern Airlines dropping nearly 6%. The lab-grown diamond sector also declined, with InnoLaser falling more than 9%. Sectors such as ports and shipping, construction machinery, and semiconductor materials were among the top losers. On the other hand, the explosive popularity of OpenClaw is expected to boost demand for cloud services, driving up the computing power leasing sector. Stocks like UCloud, Hongbo Co., Ltd., and Talkweb Information surged, with nearly 10 stocks hitting the upper limit. Meanwhile, news of the G7’s joint release of oil reserves caused petroleum stocks that had soared in early trading to narrow their gains in the afternoon, with Keli Co., Ltd. rising more than 9%. Sectors such as power grid equipment, coal, and precious metals saw gains.
Specifically:
The airport and shipping sectors experienced significant declines, with China Eastern Airlines and Spring Airlines both falling more than 5%. Air China, China Southern Airlines, Hua Xia Airlines, and Juneyao Airlines dropped more than 4%, while Hainan Airport, Xiamen Airport, and Shanghai Airport also followed suit with declines.
China Shipbuilding Group-related stocks all turned negative, with China State Shipbuilding Corporation and China Power dropping more than 4%, while CSSC Offshore & Marine Engineering, Jiuzhiyang, CSSC Special Gases, and China Marine Defense falling more than 3%.
The lab-grown diamond sector fell, with InnoLaser dropping more than 9%, Wolrd falling more than 6%, and Sifangda and Yellow River Whirlwind both declining more than 4%. Huifeng Diamond, Sinomach Precision, Norinco Red Arrow, and Chao Hung Base also weakened.
The port and shipping sector suffered a sharp decline, with COSCO Shipping Energy hitting the lower limit, China Merchants Energy Shipping falling more than 8%, China Merchants Nan Oil and Haitong Development dropping more than 6%, and COSCO Shipping Specialized and Phoenix Shipping falling more than 4%. Other declining stocks included HNA Technology, Xiamen Port Services, Straits Shareholding, and Ningbo Shipping.
CPO concept stocks collectively declined, with Jiayuan Technology and Zhaochi Co., Ltd. falling more than 8%, Yitian Co., Ltd., Changying Tong, and Huaguang New Materials dropping more than 7%, and Guangku Technology, Robotic Technology, Hengdong Optics, Dongtian Microelectronics, and Shijia Optics all declining more than 6%.
The construction machinery sector declined, with Anhui Forklift Group falling more than 6%, Liugong and Zoomlion both dropping more than 5%, while Zhejiang Dingli, XCMG Construction Machinery, Hangcha Group, Zhigao Machinery, and Sany Heavy Industry weakened.
The explosive popularity of OpenClaw is expected to boost demand for cloud services, pushing up the computing power leasing sector. Stocks like UCloud, Hongbo Co., Ltd., and Talkweb Information surged, with nearly 10 stocks hitting the upper limit.
Petroleum stocks led the gains, with Keli Co., Ltd. rising more than 9%, Potential Energy Credit and China National Offshore Oil Corporation (CNOOC) climbing more than 7%, Guanghui Energy and Tongoil Petroleum increasing more than 4%, while Blue Flame Holdings, Zhongman Petroleum, CNPC Engineering, and COSL followed with gains.
On the news front, ongoing geopolitical tensions in the Middle East have intensified, leading to a decline in oil production and a subsequent spike in oil prices. WTI crude oil prices surged over 24% to $115 today, while Brent crude soared more than 23% to $114.28, both reaching new highs since July 2022. In the afternoon, reports emerged that the G7 would discuss a joint release of emergency oil reserves, causing crude oil prices to plummet.
Coal stocks bucked the trend with gains, as Lanhua Sci-Tech rose over 6%, Shanxi Coal International, Yanzhou Energy, and China Coal Energy increased by over 5%, with Lu’an Environmental Energy, China Shenhua, Jinneng Coal Industry, and Huaibei Mining following suit with upward movements.
CITIC Securities pointed out that due to the impact of the Middle East conflict, global energy prices, although volatile, have risen significantly overall. Domestic thermal coal prices are fluctuating at high levels, while coke prices have seen one round of price cuts implemented, and coking coal prices remain weak but stable. The combination of Middle East conflicts and reduced coal supply from Indonesia is expected to create upward potential and sustained growth for domestic thermal coal prices amid persistently high imported coal prices.
The power grid equipment sector gained strength, with Pilotech rising over 22%, and Guodian Nanzi, Shunna Co., Ltd., and Sanbian Technology hitting their daily trading limits.
The precious metals sector saw partial gains, with Sichuan Gold rising 6.84%, Shandong Gold International and Western Gold increasing by over 3%, and Xiaocheng Technology climbing more than 2%.
Looking ahead, Huatai Securities stated that given the clear emphasis on maintaining momentum and prioritizing ‘quality’ and ‘efficiency’ at last year’s Central Economic Work Conference, the growth targets and macroeconomic policies proposed in this year’s government work report were within market expectations. Currently, unresolved U.S.-Iran tensions, growing uncertainty regarding U.S. tariff policies, and other external disruptions are increasing, while internal policy remains supportive but lacks significant fundamental backing. Therefore, amid internal support countering external disturbances, short-term market risk appetite faces pressure, and volatility is expected to intensify.
