A-share Midday Review | Shanghai Composite Index Falls 1.20%, Major Financials Buck the Trend, Computing Power Hardware Sector Tumbles Broadly

On October 23, the three major A-share indices opened collectively lower and weakened through the morning session. The Shanghai Composite Index fell more than 2% intraday and briefly lost the 3,600-point level, while the ChiNext Index dropped more than 3% intraday and broke below 2,500 points before paring some losses. As of the midday close, the Shanghai Composite Index was down 1.20% at 3,614.12 points, the Shenzhen Component Index was down 1.60% at 11,175.85 points, the ChiNext Index was down 2.14% at 2,521.77 points, and the STAR 50 was down 3.07%. More than 4,800 stocks across the market declined. Half-day turnover in the Shanghai and Shenzhen markets totaled 1.068 trillion yuan, an increase of 148.7 billion yuan from the previous trading day. Market Overview On the board, on the upside, the insurance sector rose 1.10%, the baijiu sector rose 1.95%, the banking sector rose 0.13%, and the Central Huijin holdings concept rose 0.60%, with the financial and consumer defensive directions closing in the green against the market trend; on the downside, the components sector fell 6.29%, communications equipment fell 5.95%, the optical fiber concept fell 5.76%, electronic chemicals fell 5.31%, the PCB concept fell 5.30%, and the cultural media concept fell 4.36%, with the computing power hardware industry chain declining collectively. Overall, the indices narrowed their losses from intraday lows, driven by heavyweight sectors such as major financials and baijiu, but the performance of heavyweights and thematic stocks diverged markedly heavyweight directions strengthened against the market trend, while previously strong computing power hardware directions such as components, communications equipment, PCB, and optical fiber plunged collectively, with more than 4,800 stocks across the market declining; several CSI 300 ETFs saw concentrated volume increases intraday, with Huatai-PineBridge CSI 300 ETF half-day turnover exceeding 8.5 billion yuan and E Fund CSI 300 ETF turnover exceeding 4 billion yuan. Hot Sectors 1. Major financials sector surged intraday The insurance sector rose 1.10% and the banking sector rose 0.13%, ChinaLin surged to the daily limit, Shanghai Chinafortune rose more than 4%, Hithink RoyalFlush Information Network rose more than 4%, Capital rose nearly 3%, and The People's Insurance rose more than 1.5%. The securities sector index edged up 0.09% at midday, notably less than insurance. Comment: On the news front, Wu Qing, chairman of the CSRC, announced on October 19 at the opening ceremony of the 2026 Financial Street Holdings Forum annual meeting that the CSRC approved the registration of the first batch of 18 active ETFs; the first batch of 18 active ETFs was officially issued on October 23, and fund companies including E Fund, ChinaAMC, Fullgoal, and China Universal announced on October 22 that they would each subscribe 200 million yuan of their own funds to their active ETFs. 2. Baijiu sector strengthened against the market trend The baijiu sector rose 1.95%, Anhui Yingjiagongjiu rose more than 5%, Anhui Gujing Distillery rose more than 5%, Jinhui Liquor rose nearly 5%, Kweichow Moutai rose more than 1.5%, and Shanxi Xinghuacun Fen Wine Factory rose more than 3%. Comment: On the news front, on October 23 the Ministry of Commerce website published "Head of the Consumer Promotion Department of the Ministry of Commerce Discusses China's Consumer Market in the First Three Quarters of 2026," showing that total retail sales of consumer goods in the first three quarters grew 1.1% year on year, with September growth of 1.1%, 0.7 percentage points faster than August, and retail sales excluding automobiles up 3.9%. Separately, according to data from the Luzhou China Baijiu Commodity Wholesale Price Index Office on October 12, the national baijiu month-on-month total price index for early October 2026 was 100.06, up 0.06%. 3. Local moves in recently listed stocks CanSemi touched the 20% daily limit intraday and was up more than 15% at midday, Luoyang Bearing Group rose more than 8%, and Jiangsu X-chip Semiconductor Technology rose more than 7%. Comment: On the news front, CanSemi said on October 21 in a reply to investors on the Shenzhen Stock Exchange's Hudongyi platform that the company will base itself on the national strategic approach of promoting high-quality development of the integrated circuit industry and refining mature process nodes, and, on the basis of continuing to consolidate its advantages in high-end analog processes, further deepen its layout in high-end digital-analog mixed-signal processes and focus on strengthening R&D and industrialization capabilities in silicon photonics and optoelectronic integration process technologies. The company listed on ChiNext on October 13, becoming the first ChiNext-listed company whose main business is wafer manufacturing. 4. Multiple Siasun Robot&Automation concept stocks hit consecutive daily limits Several stocks in the Siasun Robot&Automation concept hit consecutive daily limits, Jiangsu Huayang Intelligent Equipment rose 20% for a second consecutive limit-up, Xiangyang Automobile Bearing and ADD Industry hit a second consecutive limit-up, Qijing Machinery hit the daily limit, and Shenzhen Zhaowei Machinery & Electronics touched the daily limit intraday and was up more than 6% at midday; the Siasun Robot&Automation concept index was still down 3.39% at midday. Comment: On the news front, on October 21 U.S. Eastern Time, Musk said at Tesla's earnings call that he firmly believes the humanoid Siasun Robot&Automation track will become the world's largest industry, and expects that by the end of next year a series of issues including Siasun Robot&Automation AI, electromechanical design, reliability, and service life are expected to be resolved.