Over 3,800 stocks turn red! A-shares plunge at close reveals hidden mechanism, these three main themes become winners in future market

Key Points: The three major A-share indices plunged at the close today, with the Shanghai Composite down 0.8%. Market turnover shrank to 2.42 trillion yuan, with over 3,800 stocks declining. The market showed sharp divergence: fertilizer and wind power sectors surged to limit up driven by geopolitical conflicts and favorable overseas policies; meanwhile, non-ferrous metals and tech growth sectors retreated significantly due to profit-taking and cautious sentiment. In the short term, volatility does not alter the medium-term positive outlook. It is recommended to focus on three main themes: earnings certainty, technology and new energy, and inflation cycles.

Today’s A-share market provided investors with a vivid lesson. The three major indices fluctuated slightly in the morning and fell collectively at the close. By the end of the day, the Shanghai Composite dropped 0.8% to 4,095 points, the Shenzhen Component fell 0.65%, and the ChiNext declined 0.22%. Although the index declines seemed manageable, over 3,800 stocks in the entire market declined, with turnover decreasing by 433 billion yuan to 2.42 trillion yuan compared to the previous trading day, indicating cautious observation by some funds during the late sell-off.

Today’s market was a “clash of extremes.” On one side, fertilizer, coal chemical, and wind power sectors surged against the trend, with stocks like Jinzhengda, Lu Hua Technology, and Dajin Heavy Industry hitting the daily limit; on the other side, non-ferrous metals and precious metals plummeted, with Zhongwut High-tech hitting the limit down and Zhaojin Gold falling nearly 6%. The previously strong “periodic table” hype paused. Meanwhile, tech growth sectors like computing power and Kimi concepts also saw significant pullbacks, with Meili Cloud hitting the limit down.

Why did the market experience such extreme movements? The logic behind the leading sectors is quite clear—the global supply chain is facing an unexpected “blockage.” The core catalyst is the shipping issues at the Strait of Hormuz. According to the latest International Energy Agency report, disruptions in this critical route have directly caused breaks in the fertilizer supply chain, as large quantities of urea and sulfur are produced or pass through this area. The sharp tightening of supply expectations, combined with rigid domestic spring farming demand, instantly ignited the fertilizer and coal chemical sectors. Meanwhile, international oil prices fluctuated sharply, with Brent crude futures approaching $120 per barrel, providing strong cost support for related cyclical commodities.

The continued strength of the wind power sector also has solid catalysts. The UK announced the removal of 33 wind turbine component import tariffs starting in April, which is a key step for domestic wind equipment companies with cost advantages to expand overseas. Under the energy transition backdrop, Europe’s reliance on China’s wind power industry chain is increasing. With energy independence and export logic driving valuation re-pricing, the wind power sector’s outlook is being reassessed by the market.

In contrast, the decline in tech growth sectors today is mainly a “cooling off” of sentiment. Previously, sectors like computers and defense military industry had seen large gains, and short-term profit-taking is strong. Coupled with market caution ahead of next week’s Federal Reserve meeting, funds are temporarily flowing out of high-valuation sectors. The decline in non-ferrous metals relates to short-term fluctuations in global commodities, but it’s worth noting that the global semiconductor price hike has begun, with some TI products rising up to 85%, and the demand for upstream materials remains supported in the medium to long term.

Looking ahead, investors need not overreact to a single-day correction. The market remains in the policy dividend period of the “14th Five-Year Plan,” and the 2.42 trillion yuan turnover indicates liquidity remains solid. The short-term adjustment is mainly driven by emotional factors.

In terms of strategy, it is advisable to avoid short-term overhyped stocks lacking earnings support. Focus on three main themes:

1. Defensive consumption and high-dividend blue chips with strong earnings certainty, as core holdings during volatile periods;

2. Technology growth sectors like semiconductors, AI computing, liquid cooling, as well as new energy sectors such as wind, solar, and energy storage—using the correction window to deploy core stocks with technological advantages and overseas channels;

3. Cyclical commodities benefiting from global inflation transmission, such as energy, chemicals, and non-ferrous metals—taking advantage of supply-demand mismatches to seize short-term opportunities. After risk sentiment eases, the long-term demand for upstream materials in semiconductors and new energy remains intact.

Next week’s Federal Reserve meeting will be a key event influencing global liquidity, warranting close attention.

Note: The market carries risks; please invest cautiously. This content is based on publicly available information and does not constitute investment advice.

Author’s statement: Personal opinions are for reference only.