"What the hell is this rising? Why is my account still in the red?"
Seeing the sea of red across the "Mega-Infrastructure" main theme stocks and the continuous downward drift of growth-concept thematic equities on online stock forums, investors holding growth-concept stocks couldn't help but vent their frustrations.
"There it is again—'Coal flying, non-ferrous dancing, real estate, and finance'..."
"Pumping these industries without any expectations or future, isn't this just tricking people into holding the bag?"
"They're just pulling up previously oversold sectors. Mark my words, this rally won't go far. Don't chase the rebound; this is total bullshit."
"Sigh, the market has been rebounding consecutively, but my account keeps hitting new lows. I'm so depressed."
"By what right are steel, coal, and real estate rising?"
"This price action is practically toxic. Why is the ChiNext Index so weak and completely unable to outperform the Shanghai Composite?"
"Outperform the Shanghai Composite? The ChiNext is the weakest index in the entire market... It's mostly just heavyweight stocks rising, with zero wealth effect."
"Feels like everything going up is just unloved, cold sectors that the main institutional capital ignored before!"
"Are real estate and finance considered cold sectors? If you ask me... it's just in-market institutional funds huddling together, with zero underlying fundamental logic supporting it."
"The kicker is that real estate and finance are rising while tech stocks are still falling!"
"Looks like the market has completely abandoned tech stocks, right? It feels like all the active market capital has been sucked away by real estate, finance, coal, and non-ferrous sectors."
"Before, it was indiscriminate drops; now, it's selective drops."
"The market is going up, but my account is losing money. This is so tough, my mindset is starting to crack."
"Either you stop looking at your account, or you just have to chase the hot sectors. It feels like the 'Mega-Infrastructure' core theme is actually starting to break out."
"Chasing it right now isn't that just chasing the highs?"
"If the core 'Mega-Infrastructure' theme has already formed a breakout pattern, chasing it now isn't chasing highs."
"We should have followed President Su straight into clearing out and chasing core real estate stocks back when he massively reduced holdings in 'new energy industrial chain' stocks a few days ago."
"Hindsight is worth a fortune, but impossible to buy beforehand!"
"Cutting tech sector positions now probably still isn't too late, right?"
"I cut mine anyway. Looking at 'Win-Time Tech' just makes my blood boil—it falls when the market rises, and crashes even harder when the market falls."
"How come 'internet finance' stocks don't feel like they're rising synchronously with the 'finance' sector?"
"They haven't been synchronized for a long time. These stocks just got pumped way too high during last year's bull market."
"Every single stock that was hyped up during last year's bull market—not just internet finance, but all of them—has been stuck in a relentless downtrend."
"We really should have traded alongside President Su; otherwise, we wouldn't be losing this much."
"Right, the 'Huayi Expedition No. 1' major fund managed by President Su is literally a god in this market."
"At the beginning of the year, when I saw President Su's 'Fuxing Road' seat aggressively increasing positions in 'mass consumption', especially the 'baijiu' sector, I didn't follow and clung stubbornly to my trapped 'Storm Technology'. Now 'Storm Technology' has halved in value, while the core baijiu stocks have basically jumped by 50%. Sigh... taking that detour cost me a fortune."
"President Su's ability to unearth main themes is truly admirable. Too bad I didn't follow."
"Is it too late to follow the trend now?"
"We've got to learn from past mistakes. We must cut weak positions and chase the main theme."
"I didn't believe it before, but now I have no choice."
"Clearly, small-cap conceptual stocks in the market are beyond saving. Only large-cap core main-theme stocks are where market capital clusters, and only these stocks can generate a sustainable rally."
"Damn it, trying to recoup some losses is so hard."
"Hard? It's as hard as ascending to heaven. The key is that even when the market rebounds, whatever you buy drops, and whatever you sell rises."
"Holy shit, the 'real estate' sector gain just broke past 3%."
"The Shanghai Composite is up over 1%, but the ChiNext Index is still deep underwater."
"Active liquidity in the market is converging more and more into sectors like real estate, finance, architectural decoration, building materials, non-ferrous metals, coal, and steel."
"Look at 'Shenhuo Shares', 'PHM Coal Energy', 'Tianshan Cement', 'Beijiang Communications', 'Capital Group', 'Yukaifa', 'Bayi Steel', 'Linggang Shares'... basically all of them have hit the limit-up. Damn... when a sizzling hot market theme breaks out, you really should believe in it early. If you believed early on, you could have bought any of them yesterday and caught a limit-up today, instead of losing money like this."
"I'm losing my mind. Why isn't the ChiNext Index moving at all?"
"All the action is in the A50 component stocks. How is this supposed to play out? Are institutional funds inside the market huddling together just to force everyone else to take over their bags?"
"Bags or no bags, let's play the main theme first."
"Insane, is real estate really this ferocious?"
"The key is that it's not just A-share real estate rising; across the Hong Kong stock market, a whole bunch of mainland property stocks are soaring rapidly too."
"Could it be that the 'Mega-Infrastructure' main theme is about to run another major market wave?"
"It's truly a world of ice and fire. Sigh... whatever, cutting losses on my positions and chasing the core real estate stocks that appeared on President Su's 'Fuxing Road' list."
"Yes, yes. Trading the thematic stocks held by President Su's 'Huayi Expedition No. 1' fund feels like even if we lose, we won't lose much—definitely better than holding tech stocks that just keep dropping."
"Tech stocks and resource stocks have completely become two opposing extremes!"
"The stocks rising are mainly those that didn't experience huge gains during last year's bull market. Coupled with the fundamental industry shift in the real estate sector, there is indeed a valuation-repair opportunity."
"Hitting the limit-up board on 'China Fortune Land', hoping it doesn't bury me."
As countless retail investors trapped in market tech stocks and conceptual growth themes cursed, complained, and cut their positions to chase core hot main-theme stocks like real estate, finance, non-ferrous metals, coal, and construction, market momentum began leaning more and more heavily toward main-board equities.
The performance gap between the ChiNext Index and the Shanghai Composite—particularly against the CSI 300 Index and the A50 Index—widened further.
While the A50 Index surged over 1.5% in positive territory, the ChiNext Index remained down by 0.49%.
The divergence gap between the two indexes widened directly to over 2%, pushing almost all investors heavily weighted in ChiNext component stocks to the brink of a breakdown.
Naturally, facing this polarized market landscape,
the numerous retail investors and institutional funds who happened to be heavily positioned in hot core sectors like real estate, non-ferrous metals, coal, steel, and construction felt considerably more excited and joyful.
"Awesome, 'Shenhuo Shares', 'PHM Coal Energy', 'Tianshan Cement', 'Beijiang Communications', 'Capital Group', 'Yukaifa', 'Bayi Steel', 'Linggang Shares'... all these highly recognizable hot main-theme stocks actually hit the limit-up."
Seeing the "Mega-Infrastructure" main theme maintain its blistering momentum fueled by hot market sentiment, Zhao Zhiyuan from the Weihai Rongcheng Shidao seat in the "Qilu Faction" short-term hot-money internal group couldn't help but exclaim,
"The trajectory of the 'Mega-Infrastructure' theme and its sustainability are a bit beyond expectations!"
"Indeed, sentiment was already running a bit too hot yesterday," replied Zhang Wei from the Weihai Rongcheng Chengshan seat. "I originally thought sentiment would cool down slightly today and that relevant core hot stocks would show heavy divergence. Never expected... they actually accelerated in unison."
"If there hadn't been new positive policy stimulus last night, today's normal action should have been divergence," said Liang Jiucheng, a core figure of the "Qilu Faction" hot-money group stationed at "Jinan Lishan Road". "But with numerous positive catalysts giving a push last night, the acceleration of the entire main theme's sentiment and hot core stocks today is well within expectations. In fact, if major divergence had appeared at the morning open, that would have fallen short of expectations."
"Old Liang," Zhao Zhiyuan asked, "how much farther do you think this 'Mega-Infrastructure' theme can run?"
Liang Jiucheng said, "Hard to say for sure. From current appearances, the 'Mega-Infrastructure' theme has forged a dominant trend and siphoned off a massive amount of active market liquidity and institutional capital from other main themes. If off-market housing market activity continues to heat up and policy direction keeps throwing out positive stimuli, then I think... this 'Mega-Infrastructure' theme could very well shape up to be the core major theme of the second half of the year."
"I don't feel quite that optimistic," Zhang Wei responded. "Overall, the market still hasn't shaken off the bear market framework, and general bullish sentiment remains quite mediocre. Look at all the market's main-theme trends—aside from a brief, broad-based market rally during the closing minutes yesterday, the rest of the time... the 'Mega-Infrastructure' theme hasn't been able to drive a comprehensive market-wide rise.
Furthermore, today, the performance scissors gap between the ChiNext Index / CSI 500 Index and the CSI 300 Index / A50 Index didn't shrink; it widened.
What does this indicate?
It shows that no matter how the main-theme rally ferments internally, it remains confined to a localized market movement.
Moreover, the reason the 'Mega-Infrastructure' theme exerted such a strong capital siphon effect on other sectors is precisely due to a severe lack of active market liquidity and liquidity overall, with no fresh off-market incremental capital entering the fray.
Since there are still no new incremental funds entering...
under a stock-game (zero-sum) battle, it's very difficult to sustain a major long-lasting main-theme rally.
Therefore, at this stage, I remain quite skeptical about the sustainability of the 'Mega-Infrastructure' theme and the market's 'coal flying, non-ferrous dancing' rally.
Of course, while theme sustainability remains in doubt due to volume constraints, that doesn't mean this core theme is unplayable.
At the very least, executing short-term speculations, relaying high-visibility hot stocks, and harvesting a wave of trend-chasing retail investors by riding the wave of sentiment is entirely doable."
"I feel we shouldn't be overly optimistic, but there's no need to be overly pessimistic either," Zhao Zhiyuan chimed in. "Analyzing from a technical perspective on index trends, the market is due for a weekly-level rebound here anyway, and without a doubt... this core 'Mega-Infrastructure' theme is the catalyst for this weekly-level rebound and certainly the most explosive core theme within it.
Since it's at least a weekly-level rebound, I think... our vision should be a bit broader.
Today, the market experienced divergence alongside acceleration.
Tomorrow, as sentiment cools down slightly, there should be price divergence within the 'Mega-Infrastructure' theme.
And if we judge it based on a weekly trend, tomorrow's divergence won't be a selling point—it will be a great buying opportunity."
"Let's take it one step at a time," Liang Jiucheng pondered and said. "Let's see how strong market acceptance is after the divergence, and also keep an eye on the Hong Kong stock market.
This wave of 'Mega-Infrastructure' theme rallying was primarily driven by the 'real estate' sector.
And the abnormal movement of the real estate sector and the resulting consensus-driven speculation first appeared in the Hong Kong market.
Of course, based on general speculation, most of the anomalies in A-share and H-share property stocks were dug out and driven by that pool of capital from 'Huayi Capital'."
"Must admit, President Su of 'Huayi Capital' has truly top-tier skills when it comes to unearthing market main themes and driving main-theme rallies," Zhang Wei continued. "If not for the seat influence and market sway of President Su from 'Huayi Capital', this wave of real estate momentum probably wouldn't have been hyped up, right?"
"Isn't the underlying logic of this real estate rally still quite solid?" Zhao Zhiyuan argued with a hint of disagreement. "Housing prices across various tier cities offline have been rising recently, and a projected property bull market isn't entirely impossible. Rising offline housing prices... naturally benefit major real estate development companies and the entire industry, right?"
Zhang Wei thought for a moment and replied, "While the underlying logic is sound, the financial performance of real estate stocks—meaning the realization of expectations—tends to lag behind the industry by one to two years. In other words, the generalized rise in housing prices across major offline cities right now won't reflect in the earnings reports of major property stocks until next year, or even the year after.
Put simply, timing our speculation on the real estate sector right now is a bit premature.
Once stock prices are hyped up without earnings catching up to expectations, prices will inevitably fall back down later.
That's a major reason why I'm skeptical that this core theme can forge a long-term trend or form the kind of core stock momentum seen previously in baijiu, white goods, and pharmaceuticals.
The baijiu and white goods sectors previously unearthed by President Su of 'Huayi Capital'—whether stocks like Kweichow Moutai, Wuliangye, and Luzhou Laojiao, or the big three appliance giants Gree Electric, Midea Group, and Haier Electronics—saw their continuous stock price increases backed by earnings improvements reflected over the past one or two quarters.
This proves that earnings were driving the stock prices up.
That's why once these stocks rallied, it became very difficult for them to drop back down.
And that's also the fundamental reason why more and more institutional capital groups in the market are huddling closer and closer into the 'pharmaceutical', 'baijiu', and 'white goods' sectors."
"Old Zhang..." Zhao Zhiyuan smiled and said, "Why are you getting more and more institutionalized in your stock trading? That's an institutional mindset. Don't forget we are market hot money; we need to think about market trends using a hot-money mindset, trade with a hot-money mindset, and hunt for suitable speculative opportunities in the market.
Since we call it stock speculation, our focus naturally falls squarely on the word 'speculation'.
What do earnings expectation realizations have to do with us?
As long as there is sentiment support, enough trend-following capital coming in, and other main capital groups willing to take over our bags at this price level, isn't that enough? Are you seriously planning to buy something and hold it for a year or a half before selling?"
(End of Chapter)