Midday Review: Shanghai Index Surges Then Retreats, Down 0.58%; Lithium-ion Battery Materials and Power Sectors Bucking Trend with Activity

From: Xinhua Finance

Xinhua Finance Beijing, March 26 (Wang Yuanyuan) — The A-share market showed a rally then a pullback in the early trading session, with the Shanghai Composite barely holding the 3,900-point mark, and the STAR 50 down over 1%. At midday, the Shanghai Composite closed at 3,909.16 points, down 0.58%, with a turnover of 530.6 billion yuan; the Shenzhen Component Index was at 13,748.30 points, down 0.38%, with a turnover of 694.3 billion yuan; the ChiNext Index was at 3,314.64 points, down 0.07%, with a turnover of 314.2 billion yuan.

Sector-wise, the biggest gains were in energy metals, batteries, lithium mining concepts, small appliances, epoxy propane, and supply and marketing cooperatives; the worst performers were ground military equipment, insurance, photovoltaic equipment, and marine equipment stocks, leading the market decline.

Market Hotspots

In the market, lithium battery materials such as electrolytes, separators, and lithium mining stocks were active, with Rongjie Co., Shida Shenghua, Dadongnan, and Fosu Technology hitting daily limits; hardware related to computing power remained strong, with Yuanjie Technology, Yangfibre, and Zhilifang reaching new highs during trading. The power sector rebounded from lows, with Huadian Liaoning Energy, Hunan Development, Gannan Energy, Guangxi Energy, and Shenzhen South Electric A hitting the daily limit. On the downside, power grid equipment stocks such as Sunna Co., Jinlihua Electric, and Zeyu Intelligent saw notable declines.

In individual stocks, over 4,100 stocks declined across the market.

Institutional Views

Guojin Securities: Historical experience shows that gold generally performs well in stagflation environments, but this round’s market has priced in inflation factors early on while ignoring economic stagnation pressures. The US economy is showing signs of sluggish growth, and high oil prices could accelerate a recession. If economic stagnation and a declining capital market resonate, liquidity expectation gaps may trigger a rebound in gold.

Huatai Securities: Recent Middle East tensions have driven oil prices higher, and the market is paying attention to the economic viability of electric vehicles compared to fuel vehicles. Based on a five-year TCO cost analysis in Europe, Southeast Asia, and the US, and comparing current oil-to-electricity ratios (with crude oil at $99/barrel as of March 18), the progress toward parity is evaluated. Results show that overseas, the oil-electricity parity progress follows a “Europe > Southeast Asia > US” pattern, with Europe and Southeast Asia likely becoming key sources of incremental electric vehicle penetration amid rising oil prices. Recommended are leading companies with the highest EV sales and those with faster European deployment.

Market News

Google launches compression algorithm TurboQuant claiming about 6x memory savings

According to Cailian Press, Google recently introduced a compression algorithm called TurboQuant, which aims to reduce memory requirements for AI systems. Google states that TurboQuant compresses large language models and vector search engines by targeting the bottleneck of key-value caches used for storing high-frequency access information. As context windows grow larger, these caches become major memory bottlenecks. TurboQuant can compress key-value caches to 3-bit precision without retraining or fine-tuning the models, maintaining model accuracy. Tests on open-source models like Gemma and Mistral show approximately 6x compression of key-value cache memory. Additionally, tests on NVIDIA H100 accelerators indicate up to 8x performance improvements compared to unquantized key vectors. Researchers also note that this technology is applicable beyond AI models, including large-scale search engine vector retrieval. Google plans to showcase TurboQuant at the International Conference on Learning Representations (ICLR 2026) in April.

Guangdong: Encourages development of industrial mother machines, first-of-its-kind equipment, and other large machinery leasing businesses; explores new leasing sectors like low-altitude economy and computing power

The CPC Guangdong Provincial Committee and the Guangdong Provincial Government issued the “2026 Action Plan for Promoting the Coordinated Development of Manufacturing and Service Industries.” The plan emphasizes strengthening financial support by guiding financial institutions to utilize technology innovation and refinancing policies, increasing credit in the tech innovation sector. It encourages banks to enhance specialized branches, develop quality financing guarantees, intellectual property pledges, equity pledges, and accounts receivable financing. Insurance companies are encouraged to offer insurance products covering the entire lifecycle of manufacturing R&D, production, and operations. The plan promotes leasing of large machinery such as industrial mother machines and first-of-its-kind equipment, explores new sectors like low-altitude economy and computing power leasing, and supports regions to build leasing service clusters. It advocates making good use of national and provincial industrial investment funds, focusing on high-quality development of advanced manufacturing, investing early, small, future-oriented, and in hard tech. It supports eligible manufacturing and service enterprises in listing, bond issuance, and M&A. By 2026, the goal is for technological loans to grow faster than the average loan growth.

Editor: Hu Chenxi

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